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When the economy was in a complete equilibrium, in that case the distribution of income would be precisely proportional to the distribution of: (a) taxation. (b) inheritance. (c) luck. (d) wealth. I
When the annual interest rate is 12 percent and a rental house can be expected to rent perpetually for price of $1,000 monthly, in that case the house has a present value of approximately: (1) $240,00
To discount income which will be received in one year from the interest rate, we: (w) multiply the future income by the interest rate. (x) divide the future income by the interest rate. (y) divide the
Federal agricultural subsidies tend to be rapidly: (w) spent because most farmers lack sufficient budgeting skills. (x) capitalized in higher prices for farm land. (y) slashed while pressure mounts to
Economic rents which can be capitalized are least possible to arise by: (1) production cost advantages. (2) proprietary knowledge. (3) being first to market a differentiable new product or to innovate
Winning $50,000 yearly for 20 years is similar as winning: (w) $1 million today. (x) less than $1 million today. (y) more than $1 million today. (z) $100 per day, forever. Hello guys I want your advi
When the price of a financial asset is $1,000 and the interest rate is 10 percent, in that case investment is not justified for: (1) a perpetuity paying $100 annually. (2) an income stream paying $500
An IOU which pays a fixed amount of interest every year, without a maturity date, that is a: (w) T-bill. (x) fiduciary. (y) Series E bond. (z) perpetuity. I need a good answer on the topic of Economi
A bond which pays a fixed annual income always is: (w) an eternity. (x) a perpetuity. (y) worthless. (z) infinitely valuable. Can anybody suggest me the proper explanation for given problem regarding
When the interest rate is 5 percent and a financial investment produces annual payments of $50,000, in that case the present value of this asset is as: (w) $1,000,000. (x) $5,000,000. (y) $500,000. (z
Assume that an apartment complex is predicted to produce a consistent net $800,000 cash flow yearly in rent, after deducting all recurring variable costs (for example, taxes, utilities, and maintenanc
The procedure of transforming predictable income streams in wealth is termed as: (1) capitalization. (2) profiteering. (3) financial alchemy. (4) capitalism. (5) asset conversion. Can someone explain
Capitalization is the process whereby wealth is produced and after that recognized when: (1) financial institutions transform households’ saving in economic investment. (2) asset prices are adju
Market interest rates for different financial assets are positively associated to the: (w) expected rate of inflation. (x) liquidity of the assets. (y) efficiency of financial intermediation. (z) pref
The LEAST compatible of such with the other three sets would be as: (w) entrepreneurship and innovation. (x) uncertainty and risk. (y) pure profit and monopoly. (z) patents and freedom of entry and ex
Pure economic profit is most closely associated to the concept of: (1) exploitation of labor. (2) opportunity cost. (3) pure rent. (4) pure oligopoly. (5) capitalization. I need a good answer on the
The functions of profits into a market economy do NOT comprise: (1) stimulation for firms to be innovative and efficient. (2) compensating savers for delays of consumption. (3) signaling changing busi
According to Joseph A. Schumpeter as: (1) refined and popularized the idea that profits derive by innovation. (2) perceived profits as rewards for bearing uncertainty. (3) believed which monopoly firm
Innovating new technologies and products when bearing risks and uncertainty is amongst the roles played by: (1) bureaucrats. (2) entrepreneurs. (3) monopolists. (4) politicians. (5) inventors. How ca
Economic profits are not: (1) a surplus of revenues over opportunity costs. (2) quite similar to pure economic rents from society’s viewpoint. (3) zero in a purely competitive economy along with
In word of Frank Knight, risk: (w) exists when the probability of any specified event can be predicted. (x) appeals to the gambler personalities of innovators who next in social progress. (y) is irrel
The LEAST liquid of the given assets is: (1) a corporation's capital. (2) savings accounts. (3) cash. (4) U.S. savings bonds. (5) checking accounts. Hey friends please give your opinion for the probl
An asset’s associate “liquidity” is inversely measured through the: (w) transaction costs in dealing within the asset as a proportion of the market price of the asset. (x) time it ta
An increase during the demand for loanable funds will be mirrored through: (1) an increase in the supply of bonds. (2) a decrease into the interest rate. (3) a lower subjective internal rate of discou
Nominal interest rates are most largely and directly determined within markets for: (1) loanable funds. (2) newly issued stock. (3) foreign exchange. (4) securitized assets. (5) long term government b