which of the following transactions would be directly counted in 2007’s GDP. In each case, explain whether the action causes an increase in…
September 3, 2020
Opportunity Costs. One of the scarce resources that constrain our behavior is time. Each of us has only 24 hours in a day.
September 3, 2020

A firm’s current profits are $1,400,000. These profits are expected to grow indefinitely at a constant annual rate of 4 percent. If the firm’s opportunity cost of funds is 7 percent, determine the value of the firm

a. The instant before it pays out current profits as dividends.       $ millionb. The instant after it pays out current profits as dividends.    $ million

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