All else equal, at what interest rate would the PDV of a lottery prize that pays $1,000,000 today and $1,000,000 each year for the next 19 years be equal to $10,000,000?
A. 5.26%
B. 7.75%
C. 8.92%
D. 50.00%
C. 8.92%
You might also like to view...
Capital gains are those gains
A. earned from selling an asset prior to its maturity date. B. earned from avoiding tax payments by understating earnings from capital assets. C. earned from purchasing an asset for less than what it is actually worth. D. earned from selling an asset for a price more than what was paid for it.
If the demand for jelly decreases, and the price of grapes (used to make jelly) rises:
A. the equilibrium price of jelly rises and the equilibrium quantity of jelly might rise or fall. B. the equilibrium price of jelly falls and the equilibrium quantity of jelly might rise or fall. C. the equilibrium price of jelly might rise or fall, and the equilibrium quantity of jelly falls. D. the equilibrium price of jelly might rise or fall, and the equilibrium quantity of jelly rises.
A monopolist will never produce a level of output where MR < 0.
Answer the following statement true (T) or false (F)
The reason an unregulated natural monopolist will produce at an economically inefficient quantity is
A. that the price does not equal the true marginal cost of producing the good. B. that the monopolist will produce a quantity greater than the minimum of the average total cost curve. C. due to the fact that the monopolist will equate average total cost with price to determine the output level. D. due to the fact that the monopolist will equate marginal cost with price to determine the output level.