If the annual interest rate remains unchanged over the next two years, and the present value of $120 to be received one year from now is $100, what will $100 be worth two years from now?
A) $120
B) $140
C) $144
D) Uncertain. We need to know the interest rate.
Answer: C
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For the United States, Lorenz curves show that
A) income is more equally distributed than wealth. B) income is less equally distributed than wealth. C) incomes have increased over time. D) blacks and Hispanics became better off in the 1990s.
Refer to the Article Summary. Based on the difference between the face value of Super Bowl tickets and the prices being charged in the resale market, the demand at the face value of the tickets is
A) elastic. B) unit elastic. C) inelastic. D) perfectly elastic.
If incomes rose proportionately with prices, then in the absence of taxes
a) money would cease to be a veil b) real GDP would increase c) everyone would be worse off d) prices would have no effect on output or well-being e) resources would be over allocated to the present at the expense of future generations
In which of the following political systems would a political business cycle be more likely to occur?
A) a democracy with elections that occur on a regular basis B) a parliamentary C) communist-type economies D) socialist-type economies E) a democracy with elections that occur on an irregular basis