A firm is considering the purchase of a piece of equipment that will add $200 per year to the firm's revenue forever. If the interest rate is 10 percent, the firm will purchase the equipment so long as it costs less than
a. $1,000
b. $2,000
c. $4,000
d. $6,000
e. $8,000
B
You might also like to view...
The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
The long-run aggregate supply curve occurs at the level of real GDP consistent with
A) no inflation. B) the natural rate of unemployment. C) individuals' tastes and preferences. D) low levels of inflation.
Fill in the blank: ________ leads to speculation
A) Love B) Uncertainty C) Greed D) Money E) Sin
A method that is technologically inefficient
A) might or might not be economically efficient. B) can never be economically efficient. C) results from failure to calculate the ratio of the cost of labor to the cost of capital. D) means that it uses too much labor and too little capital.