The present value of $200 to be received after 5years at 10 percent interest is $112.2

We use a two-period model because

A) the business cycle has two phases: contraction and recovery. B) it is the simplest dynamic model. C) we want to make a distinction between young and old households. D) this is the horizon of the politicians that formulate policy.

If discrimination based on gender and race was eliminated, we would expect the:

A. personal distribution of income to become less equal. B. personal distribution of income to become more equal. C. personal distribution of income to be unaffected. D. functional distribution of income to change in favor of profits and interest.