Suppose That in Enigma, Ohio, Klutzes Have a Productivity of $1,000

question 18

Multiple Choice

Suppose that in Enigma, Ohio, klutzes have a productivity of $1,000 and kandos have a productivity of $5,000 per month.You can't tell klutzes from kandos by looking at them or asking them, and it is too expensive to monitor individual productivity.Kandos, however, have more patience than klutzes.Listening to an hour of dull lectures is as bad as losing $250 for a klutz and $150 for a kando.There will be a separating equilibrium in which anybody who attends a course of H hours of lectures is paid $5,000 per month and anybody who does not is paid $1,000 per month

• A)only in the limit as H approaches infinity.
• B)if 16 < H < 53.33.
• C)for all positive values of H.
• D)if 16 < H < 26.67.
• E)if 14 < H < 23.33.

Calculate the income yield from a rental property investment.

Understand and calculate capital gain yield on real estate investments.

Calculate the compound annual growth rate (CAGR) of an investment.

Understand the relationship between nominal and effective interest rates.