You have been promised a payment of $250,000 in the future. In which case is the present value of this payment highest?
a. You receive the payment 3 years from now and the interest rate is 8 percent.
b. You receive the payment 3 years from now and the interest rate is 6 percent.
c. You receive the payment 2 years from now and the interest rate is 8 percent.
d. You receive the payment 2 years from now and the interest rate is 6 percent.
d
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If the expected inflation rate was 2.5%, the expected real interest rate was 4.0%, and the actual inflation rate turned out to be 3.2%, then the real interest rate equals
A) 1.7%. B) 3.2%. C) 3.3%. D) 4.7%.
A business owner makes 100 . items a day. Each day he/she contributes 8 hours to produce those items. If hired, elsewhere he/she could have earned $250 an hour. The item sells for $15 each. Production does not stop during weekends. If the explicit costs total $150,00 . for 30 days, the economic profit for the month equals:
a. $300,000 b. $60,000 c. $450,000 d. $240,000