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Find the highest interest rate:
There are 2 entrepreneurs, Sally and Paul. The return to their projects are given by:
To finance the project, each entrepreneur needs to borrow from a bank an initial capital of 100. The loan contract stipulates that if the project return is high, then the firms pays principal plus interests, and if the project return is low, then the bank seizes whatever value that the firm has left over. Find the highest interest rate at which Sally is willing to borrow, the highest interest rate at which Paul is willing to borrow, and the bank's expected net profit if the interest rate is 10% and 18%, respectively.
#question.Question: Answer all parts (a, b, c, d, e & f). Consider the following insurance market. There are two states of the world, B and G, and two types of consumers, H and L,
if a bank has $6000 in checkable deposits and the required reserve ratio is 0.2 then the bank can lend how much money?
Q. What is Corporation? A corporation is a form of business established as an independent legal entity, separate from individuals who own it. A main benefit, for owners, of thi
#questioIn many metropolitan areas of the country, local governments often impose rent controls on apartments. The justification for doing so is that the current market rent is con
Deviation in graph
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Define injections and withdrawals. "The inflows in circular flow of income are known as injections". Investment, government spending and exports are there in injections "The
maximum profits will occur at the output level
construct your own version of a production possibility curve and use it to explain scarcity, opportunity cost and choice
why does economist agree or disagree?
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