Examlex
The following information relates to three mutually exclusive projects.
REQUIRED:
Compute the net present value of each project at a discount rate of 10%.
Consumer Surplus
Consumer surplus is the difference between the total amount consumers are willing and able to pay for a good or service and the total amount they actually pay.
Tax Revenues
The income received by the government from taxes imposed on individuals and businesses, used to fund government activities and public services.
Deadweight Loss
A decrease in economic efficiency arising when a good or service fails to attain or cannot possibly attain equilibrium.
Deadweight Losses
Economic inefficiencies that occur when equilibrium in a market is not achieved or when market allocation of resources is not optimal, often due to externalities or government intervention.
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