Question 1

Suppose a person pays $80 of annual interest on a loan that has a 5 percent annual interest rate. The loan amount is

Accepted Answer

A)  $400.
B)  $1,600.
C)  $160.
D)  $85.E) None of the above
F) All of the above

Question 2

List the four sources of uninsurable risk.

Accepted Answer

The four sources of uninsurable risk are...

Question 3

A major purpose of usury laws is to make more funds available to low-income borrowers. Economic analysis suggests that usury laws

Accepted Answer

A)  are effective in achieving this goal.
B)  allocate available funds to high-income borrowers.
C)  have no impact on the allocation of funds between high-income and low-income people.
D)  help low-income people only when the legal interest rate is above the market rate.E) B) and D)
F) B) and C)

Question 4

Economists claim that a farmer who owns her land, provides all her own labor, and calculates her profits from the farm by subtracting explicit costs from total revenues will

Accepted Answer

A)  overstate her accounting profits.
B)  understate her accounting profits.
C)  overstate her economic profits.
D)  understate her economic profits.E) All of the above
F) B) and C)

Question 5

Suppose you deposit $5,000 in a bank that pays 10 percent interest compounded twice a year. The actual annual interest rate you receive is

Accepted Answer

A)  10 percent.
B)  10.25 percent.
C)  11 percent.
D)  12 percent.E) A) and D)
F) B) and C)

Exam 18: Rent, Interest, and Profit

Economists claim that a farmer who owns her land, provides all her own labor, and calculates her profits from the farm by subtracting explicit costs from total revenues will

Correct Answer
verified

Suppose you deposit $5,000 in a bank that pays 10 percent interest compounded twice a year. The actual annual interest rate you receive is

Correct Answer
verified

Suppose a person pays $80 of annual interest on a loan that has a 5 percent annual interest rate. The loan amount is

Correct Answer
verified

A major purpose of usury laws is to make more funds available to low-income borrowers. Economic analysis suggests that usury laws

Correct Answer
verified

List the four sources of uninsurable risk.

Correct Answer
verified
The four sources of uninsurable risk are...
View Answer

Exam 18: Rent, Interest, and Profit

Economists claim that a farmer who owns her land, provides all her own labor, and calculates her profits from the farm by subtracting explicit costs from total revenues will

Correct AnswerverifiedShow Answer

Suppose you deposit $5,000 in a bank that pays 10 percent interest compounded twice a year. The actual annual interest rate you receive is

Correct AnswerverifiedShow Answer

Suppose a person pays $80 of annual interest on a loan that has a 5 percent annual interest rate. The loan amount is

Correct AnswerverifiedShow Answer

A major purpose of usury laws is to make more funds available to low-income borrowers. Economic analysis suggests that usury laws

Correct AnswerverifiedShow Answer

List the four sources of uninsurable risk.

Correct AnswerverifiedThe four sources of uninsurable risk are...View AnswerShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The four sources of uninsurable risk are...
View Answer