A firm has to decide between two projects that cost $10,000 each. Project A will provide a revenue $10,700 one year from now, while Project B will provide a revenue of $12,200 two years from now. The interest rate is 10% per year. This firm
A) chooses project A.
B) chooses project B.
C) rejects both projects.
D) is indifferent between projects A and B.
B
You might also like to view...
The price of a bushel of corn next year is a ________ variable because the price ________ known with certainty.
A) known; is not B) random; is C) random; is not D) known; is
The unemployment rate is the number of unemployed people, expressed as
A. a ratio of total employed to the population. B. a ratio of unemployed to the total employed. C. a percentage of the labor force. D. a percentage of the population.
If the marginal cost curve is below the average variable cost curve, then
A) average variable cost is increasing. B) average variable cost is decreasing. C) marginal cost must be decreasing. D) average variable cost could either be increasing or decreasing.
In the money market, if real GDP increases, then the demand for money ________ and the equilibrium nominal interest rate ________
A) decreases; rises B) decreases; falls C) increases; falls D) increases; rises E) increases; does not change