If you invest $2,500 in a mutual fund with a 5 percent front-end load, _____
a. $50 will be used to pay for the sales charge and $2,000 will be invested in the fund
b. there will be no sales charge and the entire $2,500 will be invested in the fund
c. the fees for the fund manager will be paid only after a period of 20 years
d. $125 will be paid to the fund manager and $2,375 will be invested in the fund
e. a fixed amount of $250 will be paid to the fund manager every year
d
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Which of the following will not reduce the likelihood of a principal-agent problem when getting your car repaired?
a. asking to see the replaced parts b. staying to watch the repair being done c. gathering information on car repair d. not paying until after the repair job is finished e. persuading the mechanic you know a lot about cars
Suppose the demand for a good is currently unit elastic over the relevant range. Then a new substitute good is introduced to the market. As a result, demand over that range is now likely to be a. Unit elastic
b. Relatively elastic. c. Relatively inelastic. d. Perfectly elastic.
At the end of the year, Ford realizes it has overproduced Fiestas, because 2,500 of them are left unsold. How is this accounted for in that year's GDP? The cars are:
A. considered durable goods, and their value will increase consumption. B. considered inventory and their value will increase investment. C. not counted until they are sold in next year's GDP. D. considered a bad thing and reduce the value of investment.
There is a futures contract for the purchase of 1,000 bushels of corn at $3.00 per bushel. At the end of the day when the market price of corn falls to $2.50:
A. nothing happened since no funds are transferred until the settlement date. B. nothing happens since marked to market adjustments only occur if the market price rises above the contract price. C. the buyer (long position) needs to transfer $500 to the seller (short position). D. the seller (long position) needs to transfer $500 to the buyer (short position).