A state agency is contemplating giving a total of $5M in grants to several universities. These grants will be paid out in installments of $500,000 per year over a 10-year period. The grants would enable low-skilled persons to be retrained for new jobs, with a resulting benefit of $5,000 per year in increased income for each of the 1,000 persons in the regional labor force, over the next 10 years. These state grants would enable the universities to obtain a total of $1M in matching federal funds for their operations, thereby reducing by $1M the total amount of state funds which would normally be required by universities. However, the grants would require 10 persons to be added to the university staffs at an average annual salary of $20,000 each, which would have to be paid out of state funds. The current annual interest rate is 10% on funds of this type. Is the retraining program an economical investment for the state on a present worth basis? Compute both the present worth BCR and the present worth NBV

Which of the following is not a consideration when determining your asset allocation

Assume that the following conditions exist: a. all banks are fully loaned up- there are no excess reserves, and desired excess reserves are always zero. b. the money multiplier is 5 .     c. the planned investment schedule is such that at a 4 percent rate of interest, investment =$1450 billion. at 5 percent, investment is $1420 billion. d. the investment multiplier is 3 . e.. the initial equilibrium level of real gdp is $12 trillion. f. the equilibrium rate of interest is 4 percent now the fed engages in contractionary monetary policy. it sells $1 billion worth of bonds, which reduces the money supply, which in turn raises the market rate of interest by 1 percentage point. calculate the decrease in money supply after fed's sale of bonds: $nothing billion.

Exercise 18-15 sheffield appliance center is an experienced home appliance dealer. sheffield appliance center also offers a number of services for the home appliances that it sells. assume that sheffield appliance center sells ovens on a standalone basis. sheffield appliance center also sells installation services and maintenance services for ovens. however, sheffield appliance center does not offer installation or maintenance services to customers who buy ovens from other vendors. pricing for ovens is as follows. oven only $790 oven with installation service 850 oven with maintenance services 970 oven with installation and maintenance services 990 in each instance in which maintenance services are provided, the maintenance service is separately priced within the arrangement at $180. additionally, the incremental amount charged by sheffield appliance center for installation approximates the amount charged by independent third parties. ovens are sold subject to a general right of return. if a customer purchases an oven with installation and/or maintenance services, in the event sheffield appliance center does not complete the service satisfactorily, the customer is only entitled to a refund of the portion of the fee that exceeds $790. assume that a customer purchases an oven with both installation and maintenance services for $990. (b) indicate the amount of revenue that should be allocated to the oven, the installation, and to the maintenance contract.