In a sensitivity analysis, managers should change ________ variable(s) at a time to determine how sensitive the ________ value of the investment is to the different variables used in the calculations.
A) one; present
B) all; present
C) one; future
D) all; future
A) one; present
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Refer to Figure 26-13. In the figure above, if the economy in Year 1 is at point A and is expected in Year 2 to be at point B, then the appropriate monetary policy by the Federal Reserve would be to
A) raise interest rates. B) lower income taxes. C) lower interest rates. D) raise income taxes.
Suppose your bank raises its minimum-balance requirement for free checking on checking accounts by $500. You take $500 out of your passbook savings account and put it in your checking account. What is the overall effect on M1 and M2?
A) M1 rises by $500, M2 falls by $500. B) M1 is unchanged, M2 is unchanged. C) M1 rises by $500, M2 is unchanged. D) M1 is unchanged, M2 falls by $500.
In deciding to produce more agricultural goods and fewer manufactured goods, a society is addressing the question of
a. where on its production possibilities frontier to operate b. what production methods should be used to produce goods and services c. how will output be allocated among the individuals in the society d. what prices will be charged for goods and services e. the optimal degree of central planning
Suppose that Christine owns her own CPA firm. She uses only two inputs in her business: her hours worked (labor) and a computer (capital). In the short run, Christine most likely considers
a. both labor and capital to be fixed. b. both labor and capital to be variable. c. capital to be variable and labor to be fixed. d. labor to be variable and capital to be fixed.