Suppose you know a piece of land will be worth $1 million (real) in 2045, and the real interest rate is 5%. About how much should you be willing to pay for the land today (2015)? (Assume no taxes)
a. $610,000
b. $1 million
c. $1.89 million
d. $230,000
d
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Which of the following statements is true of the demand curve and the marginal revenue curve of a monopolist?
A) Both curves have the same intercept on the price axis. B) The demand curve is downward sloping while the marginal revenue curve is upward sloping. C) The intercept of the demand curve on the price axis is higher than the intercept of the marginal revenue curve. D) The intercept of the demand curve on the price axis is lower than the intercept of the marginal revenue curve.
Assume a perfectly competitive firm's short-run cost is TC = 100 + 160Q + 3Q2. If the market price is $196, what should it do?
A) produce 5 units and continue operating B) produce 6 units and continue operating C) produce zero units (i.e., shut down) D) Cannot be determined from the above information
If the supply curve is vertical, then supply is
A) relatively elastic. B) perfectly elastic. C) unit elastic. D) perfectly inelastic.
Conglomerate mergers involve more than two firms
a. True b. False