Assume that Jane has limited wealth to invest in two assets both of which promise her returns worth $3,000 after two years. The first is a bank deposit assuring an interest of 10 percent per annum and the second is a private bond with an interest rate of 8 percent per annum. Which of the two would require a low initial investment and of what amount?
a. The bond requiring an initial investment worth $2,564 .
b. The bank deposit requiring an initial investment worth $2,479.
c. The bond requiring an initial investment worth $2,479.
d. The bank deposit requiring an initial investment worth $2,564.
B
You might also like to view...
When people decorate the exteriors of their homes with colored lights, they create ________ for the motorists who pass by
A) an external benefit B) a competitive good C) a public good D) an excludable good
According to the monetarists
A. the supply of money changes in response to changes in the levels of real output and prices. B. changes in the velocity of money are more important than changes in the money supply in causing the level of economic activity to change. C. an expansionary fiscal policy will lower interest rates and thereby tend to over stimulate investment and consumption. D. changes in the money supply are the primary cause of changes in the price level.
The first United States income tax was instituted in 1913
a. True b. False Indicate whether the statement is true or false
The government often enacts regulation that benefits producers because
a. the government seeks to regulate in the best interest of the public b. consumers have less information than producers and therefore seek government protection c. consumers have a strong interest in matters that affect their standard of living d. producers have a strong interest in matters that affect their specialized source of income e. producers seek to act in the best interest of the public