In answering which of the following questions would you find it necessary to calculate a future value?
a. If Jill puts $5,000 today into a bank account that pays 3 percent interest, then how much will she have in the account after 2 years?
b. Should ABC Corporation buy a factory today for $2 million, knowing that the factory will yield the corporation $3 million after 5 years?
c. As the winner of a lottery, should Michael choose an immediate payment of $250,000 or should he choose annual payments of $30,000 for each of the next 10 years?
d. You would find it necessary to calculate a future value in order to answer all of these questions.
a
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Demand for farm products, in general, is said to be relatively price inelastic. Therefore, U.S. farm policy, which is designed to keep farm prices above equilibrium, should
a. decrease farm incomes b. increase farm incomes c. not affect farm incomes d. reduce the number of farmers e. lower food prices for consumers
In the main chorus of the Keynes-Hayek rap lyrics, Keynes states "I want to steer markets" and Hayek replies, "I want them set free.". These statements are referring to
a. the tendency of Keynesians to favor government intervention and central planning and the tendency of Hayekians to favor free markets. b. the tendency of Keynesians to favor restrictive fiscal policy and the tendency of Hayekians to favor expansionary fiscal policy. c. the tendency of Keynesians to favor budget deficits and the tendency of Hayekians to insist on budget surpluses. d. the tendency of Keynesians to favor fiscal policy and of Heyekians to favor monetary policy.