Which of the following is correct if the interest rate is 6 percent?
a. $215 to be received a year from today has a present value of over $200; $420 a year from now has a present value over $400.
b. $215 to be received a year from today has a present value of over $200; $420 a year from now has a present value under $400.
c. $215 to be received a year from today has a present value of under $200; $420 a year from now has a present value over $400.
d. $215 to be received a year from today has a present value of under $200; $420 a year from now has a present value under $400.
b
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The marginal product of labor is the increase in total product from a
A) one unit increase in the quantity of labor, while holding the quantity of other inputs constant. B) one unit increase in the quantity of labor, while also increasing the quantity of other inputs by one unit. C) one dollar increase in the wage rate, while holding the price of other inputs constant. D) one percent increase in the wage rate, while also increasing the price of other inputs by one percent.
The controller of a monopoly sets the price of goods by charging _____.
(A) As much as possible, regardless of the amount sold. (B) Less than the company would charge if it did not have a monopoly. (C) The price at which the profit is maximized. (D) Only a small amount over cost.
Holding all else constant, a decrease in the real interest rate on U.S. assets will ________ the demand for dollars in the foreign exchange market and ________ the equilibrium Mexican peso/U.S. dollar exchange rate.
A. increase; decrease B. decrease; decrease C. decrease; increase D. increase; increase
“The welfare state is not a mechanism which provides something for nothing; every piece of social insurance must be paid for.” Evaluate and explain. Can you think of any circumstances in which unemployment compensation might provide “something
for nothing?” What will be an ideal response?