Assume that you have inherited a perpetual bond that pays $2000 annually. a. If you accepted $60,000 today in exchange for the bond, what is your opportunity cost of funds?
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- Julie lives for two periods. She works in the first, saves some of her income, and retires inthe second and lives off her savings. For every coconut she saves today, she earns an interestrate of r = 2%. Julie’s generation comprises of 1,000 people and each generation grows byn% relative to the previous one.a. In the first period Julie saves 100 coconuts for retirement. How many coconuts will shehave when she retires?b. Now suppose that the government implements a pay-as-you-go social security system,forcing every person in Julie’s generation to pay 100 coconuts to a social security fund thatwill distribute the money to the currently old. In exchange, when Julie retires each youngperson will pay 100 coconuts to the social security fund, and the revenue will be dividedequally among the future retirees. How much will be the revenue of the social securitysystem, and how many coconuts will each retiree will receive?c. What will have to be the range of values for n so that the government’s…A farmer selling eggs at 50.92 pesos a dozen gains 20%. If he sells the eggs at the same price after the costs of the eggs rises by 0.107, how much will be his new gain in percent?All Stafford loans are O only for full-time students for undergraduate and graduate students O subsidized by the government O for undergraduate students
- How do we use these FOCs to show that (wtNt)/Yt =(1-α) if Yt = At Ktα Nt1-αINTEREST THEORY PLEASE ASWER WITOUT EXCELSuppose the interest rate is 6 percent. Round your answers to 2 decimal places. a. What is the future value of $100 five years from now? How much of the futurebvalue is totla interest? b. By how much would total interest be greater at an interest rate of 8 percent than at an interest rate of 6 percent?
- (A) explain how rapid urbanization can pose a problem in the country. Explain in 3 sentences only. (B) How can rising rural-urban migration can be controlled? Explain in 3 sentences only.1. Describe what T’Challa thinks Wakanda’s relationship with the outside world should be. DescThree students have each saved $1,000.each has an investment opportunity in which he or she can invest upto $2,000.Here are the rates of return on the students investment project:a.If borrowing and lendind are prohibited,so each student uses only personal saving to finance his or her own investment project ,how much will each student have a year later when the project pays its return?b.Now suppose their school opens up a market for loanable funds in which students ran borrow and lend among themselves at an interest rate r.What would determine whether a student would choose to be a borrower or lender in this market?c.Among these three students,what would be the quantity of loanable funds supplied and quantity demanded at an interest rate of 7 percent?At 10percent?d.At what interest rate would the loanable funds market among these three students be in equilibrium?At this interest rate,which student(s) would borrow and which student(s) would lend?e.At the equilibrium interest rate,how…
- 4. The table below shows the total endowments of labour and capital in Germany andAustria, respectively.GermanyWorkers 100 Machines 20 Austria Workers 10Machines 4 Assess all the statements below and judge which of them is true and which is false.Provide a short justification for your assessment.According to the Heckscher-Ohlin model…a) …both countries are comparatively abundant in labour.b) …Austria is comparatively abundant in capital.c) …Germany exports should be in goods that use either labour or capital, depending on thegood.d) …Germany exports should be in goods that intensively use labour in production.e) …Austria will lose from trade, since it has both much less labour and capital endowment.In SWOT analysis what are the similarities and differences between strengths and opportunities? What are the similarities and differences between weakness and threats?a. There are two nation, UK and RSA and the combined capital stock is OA. b. In isolation, UK invests OA of capital for a yield of OC. The TP is OFGA and RSA invests O*A of capital for a yield of O*H. The TP is and the combined capital stock is OA. b. In isolation, UK invests 0A of capital for a yield of OC. The TP is OFGA and RSA invests O*A of capital for a yield of O*H. The TP is O*JMA © 87% 4 C. Since UK is capital abundant, the return on capital is low, Capital will move to where it can earn a higher return. In this case, to SA. Therefore, AB of capital moves from the UK to RSA d. With the transfer of capital to RSA, the total return on capital in UK increases from OCGA to ONRA total return on capital in RSA falls from O*HMA to O*TRA
