How do economists differentiate present value from future value?
What will be an ideal response?
Future value is the amount to which some current amount of money will grow as interest compounds over time it is always forward-looking. Present value is today’s value of some amount of money to be received in the future. The present value is a discounted future value by a given percentage.
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Other things constant, when household "time preferences" ________, business investment tends to ________
A) fall; fall B) fall; rise C) rise; fall D) rise; rise
Which of the following is FALSE?
A. A change in input prices shifts the isoquant map. B. At the optimal input choice, the rate at which the firm can substitute labor for capital in production is equal to the rate at which the firm can substitute labor for capital in the market. C. A change in cost shifts the isocost curve. D. Convex isoquants mean that the marginal rate of technical substitution decreases as the firm substitutes labor for capital. E. none of the above.
Refer to the above table. What is the marginal utility for the 10th unit for Hillary and for Bill?
A. Hillary: 10; Bill 10 B. Hillary: 220; Bill 450 C. Hillary: -10; Bill: 10 D. Hillary: 0; Bill: 0
Consider the market for cellular phones. Which of the following shifts the demand curve leftward?
A) studies showing using cellular phones can cause brain cancer B) a decrease in the price of cellular phones C) a decrease in the quantity demanded of cellular phones D) an increase in the services provided by cellular phones, such as text messaging E) an increase in the price of cellular phones