Using the Gordon growth formula, if D1 is $1.00, ke is 10% or 0.10, and g is 5% or 0.05, then the current stock price is
A) $10.
B) $20.
C) $30.
D) $40.
B
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An important determinant of velocity is the rate of interest.
Answer the following statement true (T) or false (F)
Carla had received very low annual return from her investment portfolio comprising of stocks of five companies for two years. Her decision to continue holding the same portfolio of assets will be an example of:
a. bounded rationality. b. selfishness. c. altruism. d. systematically missed opportunities.
John can clean the house in three hours and do the laundry in four. Jane can clean the house in two hours or do the laundry in two. Can they benefit by specialization and trade?
A. Neither can benefit because John has nothing to offer. B. Both can benefit because John has a comparative advantage in cleaning. C. Both can benefit because John has a comparative advantage in laundry. D. John could benefit from an exchange, but Jane cannot because she is better at both.
The economy can produce 0X and 15Y, 10X and 10Y, 20X and 5Y, or 30X and 0Y. It follows that opportunity cost of 1X is ___Y.
Fill in the blank(s) with the appropriate word(s).