Using the annuity rule, an annuity that pays $10 annually has a present value of $200 if the market interest rate is:
A. 20 percent.
B. 10 percent.
C. 5 percent.
D. 15 percent.
Answer: C
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In a principal-agent relationship
a. the principal wants the agent to act on her own behalf b. the agent wants the principal to act on his behalf c. the principal wants the agent to act on the behalf of others d. the agent wants the principal to act on the behalf of others
Economic growth can be illustrated by: a. a movement along the production possibilities curve
b. a movement from a point on the production possibilities curve to a point inside the production possibilities curve. c. an inward shift of the production possibilities curve. d. an outward shift of the production possibilities curve.
A combination of inflation and recession is called:
A. deflation. B. stagflation. C. infusion. D. disinflation.
If the spot exchange rate is undervalued, the foreign rate of return is:
a. equal to the domestic rate of return. b. greater than the domestic rate of return. c. less than the domestic rate of return. d. diverging from the domestic rate of return.