In answering which of the following questions would you find it necessary to calculate a future value?
a. If Jill puts $5,000 today into a bank account that pays 3 percent interest, then how much will she have in the account after 2 years?
b. Should ABC Corporation buy a factory today for $2 million, knowing that the factory will yield the corporation $3 million after 5 years?
c. As the winner of a lottery, should Michael choose an immediate payment of $250,000 or should he choose annual payments of $30,000 for each of the next 10 years?
d. You would find it necessary to calculate a future value in order to answer all of these questions.
a
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Given that resources can be allocated by the government, the market, a random process, or on a first-come first-serve basis, which of the following statements is true?
a. The market system is not entirely fair but it creates incentives to increase supplies and improve standards of living. b. The random process of allocation allows individuals to acquire purchasing power and enhances the value of the resources that they own. c. Since the government system does not distinguish between those who have income and those that do not, government allocation of resources is the most efficient. d. There will be no shortages under the first-come first-serve basis of allocation. e. A random process of allocation is fair in the sense that everyone gains and there are no losers.
An example of an ongoing expense for a toy company would be buying:
A. advertising for their products, and would be included in total cost. B. a new factory, and would be excluded from total cost. C. a delivery truck, and would be included in total cost. D. None of these is true.
If a country went from a government budget deficit to a surplus, national saving would
a. increase, shifting the supply of loanable funds right. b. increase, shifting the supply of loanable funds left. c. decrease, shifting the demand for loanable funds right. d. decrease, shifting the demand for loanable funds left.
In China, firms owned by the government are known as
A) state-owned enterprises (SOEs). B) government enterprises. C) corporations. D) government owned partnerships.