Q1. Why was the Teamsters Union so opposed to allowing Mexican truckers to deliver their goods in the United States? As a consumer, do you agree with the Teamsters? Why or why not?
Q2. Assume an interest rate of 7% in answering the following question.
(a) You would be indifferent between getting $12 now and X dollars two years from now. Illustrate what is X?
(b) Illustrate what is the present value of an asset that pays $20 one year from now, $15 two years from now, and $45 ten years from now?
(c) Illustrate what is the formula for the present value of an asset that pays $8 per year every year for the next 10 years, and nothing thereafter? Use the formula to compute the present value of this asset.
(d) Illustrate what is the formula for the present value of an asset that pays $8 per year forever? Use the formula to compute the present value of this asset.