5. Consider the utility function u(x, y) = 2 In x + 4y. Suppose that initially, p, = 1, py = 2, and I = 2. Now government imposes a 100% tax on Py. What is the substitution effect on x? а. -1 b. 1 c. 0 d. Uncertain

Q: The present value of a perpetuity paying $20 at the end of every four years is $43. Find i.

A:

Q: a perpetuity has a price of $750 and an annual interest payment of $35,

A:

Q: Maria takes out a 30-year mortgage for $235,136 at an annual interest rate of 4.2%. How much does…

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Q: Summarizes some of the interest formulas?

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