In terms of capital budgeting, explain the difference between risk and uncertainty
What will be an ideal response?
Uncertainty involves possible future events to which no probability values can be assigned, while risk involves such events to which probabilities can be attached to their outcome. Thus, risk adjustments can be made to expected cash flow values and/or opportunity cost rates of discount. With uncertainty, no such adjustments can be made.
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In the Keynesian model, if interest rates fall below what people consider normal, households will respond by
A) decreasing the saving rate. B) reducing the saving rate. C) holding more money. D) holding more bonds.
Which of the following statements best describes the reason for the large migration of African-Americans from the south to the north during the 1920s?
a. This movement was just a continuation of the same trend that had been occurring in large scale since the end of the Civil War. b. African-Americans moved north to reunite families that had been divided during the many years of slavery. c. The African-Americans who had worked in the south had mostly been employed in the manufacturing sector, which suffered a downturn in the 1920s. d. Employers in the North who had traditionally hired European immigrants had to search elsewhere when immigration restrictions were imposed.
Which of the following is not considered part of M2?
A. small time deposits of less than $100,000 B. money market mutual fund shares C. savings deposits D. large time deposits of more than $100,000
How many units would the given profit-maximizing nondiscriminating monopolist produce?
A. 1.
B. 2.
C. 3.
D. 4.