Stretchy Socks, Inc, is expected to earn $2,000,000 in after-tax profits each year forever. The interest rate is 0.1 . What is the total value of all shares of stock in Stretchy Socks?

Which of the following is NOT true according to Say's law?

A) Producing goods and services generates the means and the willingness to purchase other goods and services. B) Desired expenditures will always be higher than actual expenditures. C) Supply creates its own demand. D) No overproduction is possible in a market economy in the long run.

Suppose that a bond promises to pay $107 next year but the interest rate falls from 7 percent to 3 percent per year. How much will the price of the bond be and why?

What will be an ideal response?