Suppose that one-year treasury bills yield 8 percent in the United States and 6 percent in Japan. Investors will prefer to purchase the U.S. securities, unless they expect the dollar to __________ against the yen over the next year
A) depreciate by less than 2 percent
B) depreciate by more than 2 percent
C) appreciate by less than 2 percent
D) appreciate by more than 2 percent
B
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The principle that "More is better" results in indifference curves
A) sloping down. B) not intersecting. C) reflecting greater preferences the further they are from the origin. D) All of the above.
Jennifer has just finished high school and is deciding whether to start working or go to college. She has already been offered a job that pays $35,000 a year. Four years of college will cost $12,000 each year. She would earn an extra $20,000 each year after she graduates for the 45 years she plans on working until she retires. Assume that the interest rate is 8.5%. What is Jennifer's opportunity cost of one year of college?
A. $12,000 B. $17,000 C. $35,000 D. $47,000