What effect on interest rates in US Economy

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Reference no: EM131994736

1. According to the loanable funds theory of interest rate determination, a decrease in borrowing by the Treaury would have what effect on interest rates in the U.S Economy?

2. The O'Toole Company has 3,200 obsolete cell phones that are carried in inventory at a total cost of $213,600. If these cell phones are upgraded at a total cost of $80,000 they can be sold for a total of $240,000. As an alternative, the cell phones can be sold in their present consition for $89,600. The sunk cost in this situation is .......

a) $89,600

b) $0

c) $213,600

d) $293,000

e) $80,000

3. Discounting Three Years what is the present value of $260 in three years when the discount rate is 7 percent?

A. $620.00

B. $506.10

C. $663.40

D. $576.60

Reference no: EM131994736

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