Borrower with a project that has rate of return

Assignment Help Business Economics
Reference no: EM13896824

Suppose that you are a borrower with a project that has a rate of return of 2.5%. Which of the following offers to borrow $1,000 would let you earn a positive gain, provided a lender accepts your offer?

(I) You offer to borrow at an interest rate of 0.2%.

(II) You offer to borrow at an interest rate of 1.3%.

(III) You offer to borrow at an interest rate of 2.4%.

(IV) You offer to borrow at an interest rate of 3.5%.

(V) You offer to borrow at an interest rate of 4.6%.

Explain

Reference no: EM13896824

Questions Cloud

The suppliers of sugar would shift the supply curve : An excise tax of $2.00 per pound of sugar placed on the suppliers of sugar would shift the supply curve:
The price of a good will be driven to a lower price : The price of a good will be driven to a lower price when there is:
Describe the anatomy and basic physiology of the system : Describe the anatomy and basic physiology of the system
Lend to borrower during a round of the experiment : Suppose you are a lender. The T-bill interest rate is 1.4%. If you do not lend to a borrower during a round of the experiment, which one of the following would happen in that round?
Borrower with a project that has rate of return : Suppose that you are a borrower with a project that has a rate of return of 2.5%. Which of the following offers to borrow $1,000 would let you earn a positive gain, provided a lender accepts your offer?
Characteristics of promising programs : Using the Office of Juvenile Justice and Delinquency Prevention (OJJDP) resource listed below, describe some of the common characteristics of promising programs that utilize juvenile justice case management
What minimum guaranteed mileage should layton announce : Layton Tire and Rubber Company wishes to set a minimum mileage guarantee on its new MX100 tire. Tests reveal the mean mileage is 67,900 with a standard deviation of 2,050 miles and that the distribution of miles follows the normal probability distrib..
How does each of these concepts function in the process : What would be the main thesis of each of the videos with regard to the concepts and how they can be comprehended by the public?
Common barriers to active listening and describe : common barriers to Active Listening anddescribe

Reviews

Write a Review

Business Economics Questions & Answers

  Evolution of work on the laissez-faire

Trace the evolution of work on the laissez-faire doctrine through two arcs. First those theorists who are trying to prove that the system is stable

  Qon january 2d 2012 canon expects to ship 750000 all-in-one

q.on january 2d 2012 canon expects to ship 750000 all-in-one fax printers and copy machines from its plant in japan to

  Foreign exchange risk

A manufacture procedure using 2 inputs, labor as well as capital.

  What is the political business cycle

If the exchange rate rises, domestic goods become relatively ______ expensive. This change in the affordability of domestic goods makes domestic goods _____ attractive to foreigners. So, _______ ______. (choose - more,/less, imports/exports, fall/ris..

  Major rating agencies

Given your understanding of bond markets, what signals is the the bond market sending in response to the downgrade. Is this problematic.

  Compute the lerner index

Two firms compete under Cournot competition with constant marginal costs c1 = 2 and c2 =6. The market demand is p=24-q. Compute the market share of each firm, the market price, and the total quantity produced in the market. Compute the Lerner index.

  When is predatory pricing a most effective entry barrier

When is predatory pricing a most effective entry barrier?

  Contraction monetary policy work in principle

How do the instruments of contraction monetary policy work in principle.

  How many popsicles will be sold-supplied

How many popsicles will be sold/supplied each day in the short run if the price rises to $4 each per day

  How is the equilibrium price determined

How is the equilibrium price determined? What happens if the price is above the equilibrium price? What happens if the price is below the equilibrium price?

  Inflation represents a decline in average real income

Most economists want a 0% target for unemployment. The current natural rate of unemployment is thought to be somewhere around 5%. If the economy is above full employment it causes higher than normal unemployment. In a closed economy, inflation repres..

  Illustrate what would be the most likely maximum possible

Illustrate what would be the most likely maximum possible loss per share if you simultaneously place a stop-buy order at $128.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd