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Author Question: Look at today's Wall Street Journal. What is the leading economic news story? With which of the big ... (Read 242 times)

karlynnae

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on: Jun 29, 2018
Look at today's Wall Street Journal. What is the leading economic news story? With which of the big economic questions does it deal and what tradeoffs does it discuss or imply?
 
  What will be an ideal response?

Question 2

How is the concept of present value useful in deciding whether or not to undertake an investment project?
 
  What will be an ideal response?


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ebonylittles

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Reply #1 on: Jun 29, 2018
Answer to Question 1

On May 6, 2014, the top economic news story discussed a report claiming that climate change is already harming the economy. The report asserted that climate change is already bringing extreme weather such as floods, drought, and other weather-related disasters, all of which harm the nation's economy.
This story implicitly discusses the how question: Will goods and services be produced in ways that limit climate change or not? It also discusses the what question: Will goods and services that limit climate change, such as solar panels, be produced?
The story implicitly illustrates a tradeoff: If choices are taken to limit climate change, such as reducing carbon emissions from generating power, consumers will pay higher prices but the extent of climate change will be decreased.

Answer to Question 2

If the present value of the income stream associated with an investment is less than the full cost of the investment project, the investment should not be undertaken. If the present value of the income stream is greater than or equal to the full cost of the investment project, it should be undertaken.


karlynnae

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Reply #2 on: Jun 29, 2018
Thank you


ebonylittles

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Reply #3 on: Jun 29, 2018
No problemo


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