Erin just won Lotto America, which will pay her $40 million over the next 20 years at a rate of $2 million a year. Is Erin $40 million richer today?
Even though Erin will eventually receive $40 million, she would not be considered that wealthy today. Income to be received in the future is discounted to determine its present value. Also, for purposes of determining Erin's wealth, we would need to consider current and future tax liability.
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All of the following are true concerning the flexible exchange rate system except one. Which is the exception?
a. It is the same as a floating exchange rate system. b. It is a system in which supply and demand determine the exchange rate. c. Government officials have little direct role in the foreign exchange market. d. Exchange rates may fluctuate considerably from time to time. e. Exchange rates are fixed by the central banks of the various countries.
In general, economists place all factors of production into which three categories?
A. Technology, labor, and capital B. Technology, land, and capital C. Land, labor, and capital D. Land, labor, and technology
A good is most likely to be inefficiently priced if
a. some of the resources used in its production are scarce. b. the good is private property. c. some of the resources used in its production are free. d. a corporation produces the good.
Which of the following would likely result in a shift of the aggregate demand curve to the right?
A. a tax cut B. a rise in the real interest rate C. a decrease in the quantity of money in circulation D. a decrease in job security