Suppose you have a choice between receiving a lump-sum payment of $10,000 today or four annual payments of $2,750 (with the first payment today). Of the following, which is the lowest annual interest rate at which you would prefer the lump-sum payment over the four annual payments?
a. 2%
b. 5%
c. 7%
d. 10%
c
Economics
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Which of the following is NOT a solution to a principal-agent problem?
A) ownership B) managerial hierarchy C) incentive pay D) long-term contracts
Economics
Given the information in Scenario 14.1, how much labor will be hired to maximize profit?
A) 1/16 B) 1/2 C) 1 D) 4
Economics
A leftward shift in supply could be caused by: a. an improvement in productive technology. b. a decrease in income
c. some firms leaving the industry. d. a fall in the price of inputs to the industry.
Economics
If the government provides a subsidy in one industry and raises the tax revenue by taxing another industry, would, other things equal, cause welfare costs in both industries
a. True b. False Indicate whether the statement is true or false
Economics