Given the table above, the present value of lifetime resources ________ when the real interest rate rises to five percent
A) falls by $367
B) rises by $200
C) rises by $300
D) falls by $275
A
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Which of the following is an advantage of hedging with options instead of forward contracts?
A) Options prices tend to be lower than forward prices. B) If the price moves in the opposite direction to the one hedged against, the hedger can decline to exercise the option and limit the loss to what was paid for the option. C) If the price moves in the direction of the one hedged against, the hedger can decline to exercise the option and limit the loss to what was paid for the option. D) Options allow investors to purchase a forward contract at a later date.
Suppose you purchase a one-year bond that has a $450 coupon and a face value of $5,000, and immediately after you purchase the bond, new bonds are issued that are otherwise identical, except they have coupons of $375
If you sell your bond, you will A) suffer a loss of $5.76. B) suffer a loss of $412.84. C) receive a gain of $69.77. D) receive a gain of $418.60.
An economy has two workers, Paula and Ricardo. Every day they work, Paula can produce 4 computers or 16 shirts, and Ricardo can produce 6 computers or 12 shirts. What is the most of each good that can be produced each day if each worker fully specializes according to his/her comparative advantage?
A. 8 computers and 22 shirts B. 5 computers and 14 shirts C. 4 computers and 12 shirts. D. 6 computers and 16 shirts
Josh is eating pizza at his favorite Italian restaurant. Below is his utility from this consumption:Table 19.1Slice of PizzaTotal UtilityMarginal UtilityFirst slice2020Second slice3919Third slice-15Fourth slice59-Refer to Table 19.1. For Josh, diminishing marginal utility begins
A. After the second slice of pizza. B. To increase after the first slice of pizza. C. After the first slice of pizza. D. After the third slice of pizza.