Calculate the user cost of capital of a machine that costs $5000 and depreciates at a rate of 25%, when the expected real interest rate is 5%.
A. $1500
B. $500
C. $150
D. $5000
Answer: A
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Suppose the nation of Arcadia produces only two goods, teapots and surfboards. If Arcadia produces only teapots, it can make 40 per day. If Arcadia produces only surfboards, it can make 60 per day
What is the opportunity cost of 1 teapot in Arcadia? A) 2/3 of a surfboard B) 1.5 surfboards C) 40 surfboards D) 60 surfboards
The required stock return an investor seeks can best be represented by which of the following?
A. Risk-free Return + Risk Premium B. Risk Premium - Risk-free Return C. Risk-free Return × Risk Premium D. (Risk-free Return + Risk Premium)/(1 + i)
All of the following are examples of goods for which external costs commonly exist EXCEPT
A) cigarettes. B) automobiles. C) vaccinations. D) oil transportation.
In the ten year period 1981-1990, 1202 commercial banks were closed, with a peak of 206 failures in 1989. This rate of failures was approximately ________ times greater than that in the period from 1934 to 1980
A) two B) three C) five D) ten