A rise in the interest rate will generally result in people consuming less when they are old if the substitution effect outweighs the income effect

Refer to the scenario above. A change in the probability of breakdown to 10 percent will:

A) increase the net present value to $135.65. B) lead to a negative net present value. C) decrease the net present value to $16.02. D) decrease the net present value to $10.

The market demand for wheat is ________ and the demand for wheat produced by an individual farm is ________

A) perfectly elastic; perfectly inelastic B) not perfectly elastic; perfectly elastic C) not perfectly inelastic; inelastic D) elastic; unit elastic