(Advanced analysis) Kara has $2,000 to invest today that she wants to grow to $3,000 in five years. What annually compounded rate of interest would she have to earn to reach her goal?
A. 4.6 percent.
B. 6.5 percent.
C. 8.4 percent.
D. 9.3 percent.
C. 8.4 percent.
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Which of the following is the most liquid asset?
a. Traveler's checks. b. Savings-type deposits. c. Small time deposits. d. Large time deposits. e. A modern art painting.
Figure 7.5
The consumer must decide how to split $20 between spending and saving.Refer to Figure 7.5. If the consumer uses cognition to offset present bias, he/she will maximize utility at a marginal utility per dollar of ________ utils for consumption and ________ utils for saving.
A. 15; 15 B. 15; 30 C. 30; 15 D. 30; 30
An individual insured against a particular cost, a. has reduced incentives to take precautions against those costs. b. may take on additional risk because he/she is insured
c. faces incentives that can result in higher insurance rates. d. All of the above are true.
Mary is maximizing utility by eating three pancakes and two eggs. The principle of rational choice says that if there is diminishing marginal utility and the price of eggs rises, Mary will choose to eat more pancakes and fewer eggs.
Answer the following statement true (T) or false (F)