Author Question: If the interest rate is 8 percent, a person who is offered the opportunity to buy an annuity paying ... (Read 101 times)

lb_gilbert · **on:** Jun 30, 2018

If the interest rate is 8 percent, a person who is offered the opportunity to buy an annuity paying 30,000 per year forever should
a. do so if the price is greater than 375,000
b. do so if the price is less than 375,000
c. be willing to pay only 37,037 for it
d. be willing to pay 77,037 for it
e. be willing to pay no more than 300,000 for it

Question 2

The demand for foreign currency in the United States
a. increases as the level of imports increases
b. increases as the level of exports increases
c. decreases with the lowering of the inflation rate abroad
d. decreases as foreign interest rates rise
e. is unaffected by U.S. demand for goods and services abroad