Explain each of the determinants of the present value of expected profits from a buying a new machine
What will be an ideal response?
A firm must form expectations of future expected profits (per unit of capital). This implies that they must also form expectations of future output which are correlated with future profit. They must also form expectations of future interest rates to calculate present values. And finally, they must know the current price of the project and the rate of depreciation. Once they do all of this, they calculate the discounted present value of the project and compare that with its price.
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The Big Mac index is a measure of how well the purchasing power parity theory works.
Answer the following statement true (T) or false (F)
Union membership as a percentage of the civilian labor force is lower in the United States than in Germany or Japan
a. True b. False Indicate whether the statement is true or false
Both an increase in employment opportunities and an increase in immigration lead to a shift to the right in the supply curve for labor
Indicate whether the statement is true or false
Within the U.S. population, women of prime working age (ages 25-54) have higher rates of unemployment than men of prime working age (ages 25-54), regardless of race
a. True b. False Indicate whether the statement is true or false