At which interest rate is the present value of $168.54 two years from today equal to $150 today?
a. 4 percent
b. 5 percent
c. 6 percent
d. None of the above would give a present value within a cent of $162.24.
c
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Which of the following is an example of a product that is nonexcludable and rival?
A) a motorcycle B) the court system C) Western lowland gorillas D) a NASCAR event
Refer to the graph. Using Qs for quantity supplied and P for price, which of the following equations correctly states the supply of this product?
What will be an ideal response?
The deadweight loss of a tax
A) is the transfer of income from households to the government. B) determines the incidence of a tax. C) is part of the total burden of a tax. D) is greater than the total burden of a tax. E) equals the tax revenue collected by the government.
Proponents of the new classical macroeconomics do not believe which of the following?
A) Wages and prices will adjust rapidly in the economy. B) Workers and firms use information contained in Fed policy to form inflation expectations. C) The economy will normally be at its potential level. D) Expansionary monetary policy can be an effective policy tool.