You expect to rent out a vacation home on Sanibel Island for $800 a month as an investment. Upkeep is estimated at $3,000 a year. If the current market interest rate is 5 percent, you are willing to pay __________ for the house

Suppose that a firm can invest $100 today in a project and receive $105 a year from today. There is no inflation, and the annual interest rate in the economy is 6%. The firm should

A) invest in the project because the opportunity cost is greater than the return on the investment. B) not invest in the project because the opportunity cost is greater than the return on the investment. C) invest in the project because the opportunity cost is less than the return on the investment. D) invest in the project because the opportunity cost is the same as the return on the investment.

If an average cost pricing rule is imposed on the firm in the figure above, the consumer surplus will be

A) zero. B) $450. C) $400. D) $200.