8.) An entrepreneur needs thousand of dollarsto launch the global expansion of hissoftware business. I have agreed to lend himthe money today (n=0) at an interest rate of8% compounded quarterly. I required thatthe loan be repaid in eight annual paymentsstarting at Year 4 with a $20K payment.Subsequent payments will decrease by$1K each year thereafter. (1) What is thepresent value of the money being borrowed?(2) Convert your Present Value to AnnualPayment.Answer:ieff = Blank 1 show in four decimalPoTotal = $ Blank 2Ⓒ starting at Year 4 with a $20K payment.Subsequent payments will decrease by$1K each year thereafter. (1) What is thepresent value of the money being borrowed?(2) Convert your Present Value to AnnualPayment.Answer:ieff Blank 1 show in four decimalPoTotal = $Blank 2A/POTotal = $ Blank 3=Note: Do not round in between solution. No need to put UOM andcomma. Final answer round to the nearest WHOLE NUMBER.

Effective annual rate (EAR) refers to a real interest rate that an investor wants from his…

An entrepreneur needs thousand of dollars to launch the global expansion of his software business. I have agreed to lend him the money today (n=0) at an interest rate of 8% compounded quarterly. I required that the loan be repaid in eight annual payments starting at Year 4 with a $20K payment. Subsequent payments will decrease by $1K each year thereafter. (1) What is the present value of the money being borrowed? (2) Convert your Present Value to Annual Payment.

An entrepreneur needs thousand of dollars to launch the global expansion of his software business. I have agreed to lend him the money today (n=0) at an interest rate of 8% compounded quarterly. I required that the loan be repaid in eight annual payments starting at Year 4 with a $20K payment. Subsequent payments will decrease by $1K each year thereafter. (1) What is the present value of the money being borrowed? (2) Convert your Present Value to Annual Payment.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Each term (3 months) the current group of economics students completed a questionnaire as to how much they would spend on new purchases compared to how much they would save/pay off bills, if they suddenly and unexpectedly received a check for $1,000. The average MPC is shown in the table below. Month in which student poll was taken Average of students’ responses as MPC March 0.41 June 0.30 September 0.22 December 0.56 What do these MPC’s imply about the students’ thinking over the course of the year? (Enter response here.) What is likely happening in the economy during the same period of time?
13. (Use this information to answer qustion 13 - 16) Suppose a household solves the following two-period consumption-savings problem max u(c₁) + Bu(c2) {C1,C2} s.t. aw Y1 - C1 C2y2 (1+r)a with u(c) = √c where c₁ is consumption at time 1, c2 is consumption at time 2, y₁ is houshold income at time 1, 2 is houshold income at time 2 and w is the initial wealth. Suppose the incomes of the household are $50 in time 1 and $210 in time 2. The initial wealth is $100, the discount factor is 0.975 and interest rate is 5%. Solve for the household's choice of C1. (a) 125.12 (b) 126.58 (c) 175.16 (d) 341.88 14. Now a government wants to introduce income tax in both time 1 and time 2 {1, 2} to finance a construction project that costs $50 in time 1 and another $52.5 in time 2. Which ones of the following are the household intertemporal budget constraints. (a) y1 + 1/2 =C1+ 1+1 Y2 (b) w+y1 + = C₁ + 1+r 1+r (c) wy1T1 + Y2 T2 1+r Y2 1+r = €1 + 12 1+r (d) wy171 + =C1+ 1+r C2 (1+72) 1+r 15. Solve for the…
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3. [Sometimes, it's useful to think about what fraction of a consumer's money they spend on each good, rather on how many units they buy. (a) Show that every x EX(p,m) can be written as x = f1(m/p₁,0) + f2(0, m/p2 ) + (1-f1-f2)(0,0) for some numbers f1,f2 20 with f1 + f2 ≤1. (b) Let f1 and f2 be as in part (a). Give an expression, in terms of f1 and f2, for the fraction pix₁/m of the consumer's money that they spend on good 1. (c) Let f1 and f2 be as in part (a). Give an expression, in terms of f1 and f2, for the fraction p2x2/m of the consumer's money that they spend on good 2
2. (a) What does the index of intra-industry trade measure and does it tell us anything about the total amount of trade? (b) There are two ways of measuring the degree of intra-industry trade within an industry: min (imports, exports) Index of intraindustry trade = 1 2 (imports + exports) -(lexpe (lexports - imports| exports + imports Grubel Lloyd index = 1 - Using the first formula, calculate the index of intra-industry trade for the U.S in 2014 for the products on Table 1. Using your answer in (b) above, what does the index of intra- industry trade of men's shorts, large passenger aircraft, telephones and golf carts tell us? (d) What are the two necessary conditions to obtain a high index of intra-industry trade?
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12 ( answer only )
2. (TRUE/FALSE) To economists, the amount of a resource stock in situ is an important measure of scarcity of the resource
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