A firm will have constant profits of $100,000 per year for the next four years, and the interest rate is 6 percent. Assuming these profits are realized at the end of each year, what is the present value of these future profits?
A. $346,510.56
B. $325,816.49
C. $376,741.64
D. $400,000.85
Answer: A
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A student has a job that pays a wage rate of $10 per hour. The night before an economics exam, the student has set aside four hours to study for the exam, estimating that for each hour spent studying, her grade will rise by 5 points
That night, she gets a call from her employer to come to work for a wage rate of $15 per hour for that night. She decides to work for three hours and earn an extra $45.00. The next day she takes the test and gets a grade of 75. The opportunity cost for her work is A) the $45.00 she earned. B) the 15 extra points she estimates that she could have earned on the exam if she had studied the extra three hours. C) the three hours she did not study. D) the entire four hours she set aside for studying.
Which of the following would cause a rightward shift in the aggregate supply curve?
a. Larger-than-expected wage increases. b. Lower oil prices. c. Increased investment spending. d. Greater government regulation.
The externality associated with technology spillovers
a. cannot be internalized by government. b. is a negative externality. c. can be internalized, potentially, through taxation of firms that are responsible for technology spillovers. d. can be internalized, potentially, through patent protection.
A vertical demand curve is
A. perfectly inelastic. B. perfectly elastic. C. has elasticity of zero. D. unit elastic.