Refer to the Accompanying Figure

question 120

Multiple Choice

Refer to the accompanying figure.If the government has a budget of $300,000 to purchase surplus shampoo,what is the maximum possible floor price that could be imposed?

• A) $1
• B) $2
• C) $3
• D) $4
• E) $5

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Definitions:

Compounded Quarterly

Interest that is calculated and added to the principal at the end of every quarter, leading to an increase in the amount of subsequent interest.

Maturity Value

The amount payable to an investor at the end of a fixed term investment, including the principal and interest.

Maturity Value

The amount payable to the investor at the end of a fixed term investment, including the principal and the interest.

Equal Payments

Recurrent payment amounts that are the same in total over a specified period, common in loans and amortizations.