At a discount rate of 6 percent, what is the net present value of an investment project expected to yield $1,000 per year (to be received at year end) for the next three years?
a. $3,000
b. $2,829
c. $2,673
d. There is insufficient information to determine whether the project should be undertaken.
C
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Suppose the world economy is divided into two halves. In Region A, all economies experience a decrease in desired saving, while desired saving is unchanged in Region B
If there is open trade and perfect capital mobility across the two regions, which of the following is true? A) Actual saving in Region B has increased. B) Actual investment in Region A has increased. C) Region A's imports from Region B have decreased. D) all of the above E) none of the above
The Clayton Act of 1914
a. was too vaguely worded to reduce anticompetitive behavior significantly b. prohibited conspiracies in restraint of trade c. prohibited price discrimination that reduces competition and cannot be justified based on cost differences d. created the Federal Trade Commission e. prohibited firms from reducing prices too far
Which of the following is not an argument made by those who oppose reforming the tax laws to encourage saving?
a. A public budget surplus can raise national saving. b. The substitution effect of a higher return to saving may be about equal to the income effect of a higher return to saving. c. Low-income households save a larger fraction of their income than high-income households. d. Tax cuts might cause a budget deficit.
Currently, a monopolist's MR = $5 and its MC = $10 and it serves 10 consumers. An 11th consumer walks in. Should the company provide service to the additional customer?
A. Yes, MC is equal to the number of customers, so it should provide service to the additional customer. B. No, MR < MC, so it should not provide service to the additional customer. C. No, MR is less than the number of customers, so it should not provide service to the additional customer. D. Yes, MR < MC, so it should provide service to the additional customer.