The Present Value of $300 Received 5 Years in the Future

question 400

Multiple Choice

The present value of $300 received 5 years in the future would be calculated as which of the following when the interest rate is 5%?

• A) 300/(1.5)⁵
• B) 300/(1.05)⁵
• C) 300 × 1.5 × 5
• D) 5.05/300

Understand the implications of inflation and price level changes on output.

Know the determination factors of wage rates in collective bargaining and their relation to monetary policy.

Realize the limitations of active policy in influencing output under rational expectations.

Identify the conditions under which fiscal and monetary policy can stimulate output and employment in the short run.

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Definitions:

Nonspecific Response

A generalised reaction by the body to a stressor, not directed against any particular pathogens.

Hassles

Minor irritations or annoyances that occur in daily life and can cumulatively lead to stress.

Uplifts Scale

A tool used to measure the positive experiences and resources that individuals perceive in their lives, which can counterbalance stress.

Epinephrine

A hormone also known as adrenaline, produced by the adrenal glands, playing a vital role in the body's fight-or-flight response by increasing heart rate and blood flow.