Suppose that a new machine tool having a useful life of only one year costs $80,000. Suppose, also, that the net additional revenue resulting from buying this tool is expected to be $96,000. The expected rate of return on this tool is:
A. 80 percent.
B. 8 percent.
C. 2 percent.
D. 20 percent.
D. 20 percent.
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The idea that MPCs are different in different stages of a person's life is called
a. Keynes's absolute income hypothesis b. Duesenberry's relative income hypothesis c. Friedman's permanent income hypothesis d. the life-cycle hypothesis of consumption e. the consumption function
The yield curve is the relationship between the:
a. Real interest rate and expected inflation rate. b. Domestic yield and foreign yield. c. Real yield (i.e., interest rate) and actual inflation. d. Nominal yield and time to maturity of a security. e. Nominal yield on corporate securities and the yield of government securities.
Suppose that over the last year the price of copper increased from $1.70 a pound to $1.79 per pound. Over the same time a measure of the overall price level increased from 300 to 309 . The price of copper increased by
a. less than inflation, and this means it became relatively less scarce. b. less than inflation, and this means it became scarcer. c. more than inflation, and this means it became scarcer. d. more than inflation, but this doesn't necessarily mean that it become scarcer.
Which of the following statements is correct?
A. If purchasing the same goods today as one year ago requires less money, the money supply likely increased. B. If you can buy the same goods this year as you bought last year with less money there must have been inflation. C. If purchasing the same goods today that were purchased one year ago requires more money, there must have been deflation. D. If purchasing the same goods today as one year ago requires less money, the money supply likely decreased.