You receive an e-mail from a firm proposing the following business deal. They will send you $1,000 now, and in exchange you will send them $1,100 in one year. You will just break even from this deal if the interest rate is:
a. 12%.
b. 4%.
c. 6%.
d. 10%.
d. 10%
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Suppose that the U.S. interest rate is 5 percent and the Japanese interest rate is 1 percent. The effect of this difference in the foreign exchange market is that
A) financial capital stops moving. B) a Japanese investor is guaranteed to make an additional 4 percent in yen terms by investing in the United States. C) investors expect the yen to appreciate against the dollar. D) investors expect the yen to depreciate against the dollar.
Which of the following statements about economic resources is true?
A) Economic resources include financial capital and money. B) All economic resources are man-made. C) Economic resources are also called factors of production. D) Economic resources are used only by businesses.
Bundling raises higher revenues than selling the goods separately when
A) demands for two goods are highly positively correlated. B) demands for two products are mildly positively correlated. C) demands for two products are negatively correlated. D) there is a perfect positive correlation between the demands for two goods. E) the goods are complementary in nature.
Have unions been successful at raising wages for their members? What about raising wages for all workers?
What will be an ideal response?