ABC Corp. is considering an investment project that costs $500 today. It expects the project will yield income of $200 at the end of years 1, 2, and 3. If the interest rate is 10%, the firm
A. should forgo the investment.
B. is just indifferent between undertaking the investment and not.
C. should undertake the investment.
D. indeterminate from the given information
Answer: A
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Raising the welfare of the worst-off person in society is an important goal of which political philosophy?
a. utilitarianism b. liberalism c. libertarianism d. secularism
A production possibilities curve has "good X" on the horizontal axis and "good Y" on the vertical axis. On this diagram, the opportunity cost of good X, in terms of good Y, is represented by the:
A. distance to the curve from the horizontal axis. B. distance to the curve from the vertical axis. C. distance from the origin to the curve. D. change in Y for each change in X along the curve.
Suppose the capital gains tax is 28 percent and you purchased a house ten years ago for $80,000. If you sold the house today you would get $140,000. Your tax liability would be
A. $39,200. B. $16,800. C. indeterminate without knowing the inflation rate. D. indeterminate without knowing the personal income tax rate.
While the budget deficit represents a ________, the public debt represents a ________.
A. flow; stock B. flow; flow C. stock; stock D. stock; flow