Super Haulers is a hauling company and delivers large and heavy materials to construction job sites. Super Haulers is considering purchasing a new dump truck that costs $185,000 and the managers of Super Haulers have estimated that the new dump truck will generate $50,000 a year in future operating profit for the next four years. At the end of four years, Super Haulers can sell the dump truck at
a salvage price of $20,000. If the discount rate is 5 percent, which of the following is true if the managers of Super Haulers are profit-maximizing?
A) The manager should not make the investment because the net present value is negative.
B) The manager should make the investment because the net present value is positive.
C) The manager should make the investment because the net present value is negative.
D) The manager should not make the investment because the net present value is positive.
B) The manager should make the investment because the net present value is positive.
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If banks move a substantial portion of depositors' money from interest-earning checking accounts into money-market deposit accounts, how will the money supply measures be affected?
a. M1 will become smaller, and M2 will become larger. b. Both M1 and M2 will increase in size. c. Both M1 and M2 will decrease in size. d. The size of M1 will be reduced, but M2 will be unchanged.
Which statement is true?
A. The United States' economic system leads to an equitable distribution of income. B. One of the basic functions of the United States' government is to transfer some income from the rich and the middle class to the poor. C. The price mechanism and the definition of economics are incompatible. D. None of the statements are true.
GDP is the total value of all _____ goods and services produced within a nation's borders in a given time period.
A.) final B.) unfinished C.) intermediate D.) non-exported
Which of the following elements are necessary for an expansionary monetary policy to be successful?
a. the Fed decreasing money supply; banks sitting on reserves; firms refusing to borrow from banks b. the Fed decreasing money supply; banks using reserves for loans; firms refusing to borrow from banks c. the Fed increasing money supply; banks sitting on reserves; firms borrowing from banks d. the Fed increasing money supply; banks using reserves for loans; firms borrowing from banks