Are America's top chief executive officers (CEOs) really worth all that money? One way to answer this question is to look at row B, the annual company percentage increase in revenue, versus row A, the CEO's annual percentage salary increase in that same company. Suppose that a random sample of companies yielded the following data:

B: Percent increase for company 37 7 12 7 21 18 17 10

A: Percent increase for CEO 28 10 9 3 26 16 20 7

Do these data indicate that the population mean percentage increase in corporate revenue (row B) is different from the population mean percentage increase in CEO salary? Assume that the distribution of differences is approximately normal, mound-shaped and symmetric. Use a 1% level of significance. Find (or estimate) the P-value.

Select one answer:

a. 0.02 < P-value < 0.05

b. 0.01 < P-value < 0.02

c. 0.25 < P-value < 0.50

d. P-value = 0.05

e. P-value = 0.25

29.) Over time, technological improvement lowers the cost of producing smartphones and also raises buyers’ incomes. Assume that smartphones are normal goods.

As a result, the supply of smartphones will (increase, decrease) and the demand for smartphones will (increase, decrease). We would expect the equilibrium quantity of cellphones bought and sold will (increase, decrease, stay the same), while the price of smartphones could rise, fall, or stay the same. (6 points; 2 points each)

35.) American University is interested in increasing total revenue from ticket sales to the public for basketball games at Bender Arena. Suppose AU estimates that the demand for basketball tickets is elastic. Should AU increase or decrease ticket prices sold to the public to raise total revenue? (increase, decrease) (1 point)

38.) The price of gasoline rose sharply last month, while the quantity sold remained the same. Three people offer possible explanations:

a.) Alice: Demand increased, but supply was perfectly inelastic.
b.) Beth: Demand increased, but supply decreased at the same time. c.) Colleen: Supply decreased, but demand was perfectly inelastic

13. Consider the specific-factors model and use the following information to answer the questions below: Manufacturing: Sales revenue = PM · QM = 150 Payments to labor = W · LM = 100 Payments to capital = RK · K = 50 Percentage change in price = 0% Agriculture: Sales revenue = PA · QA = 150 Payments to labor = W · LA = 50 Payments to land = RT · T = 100 Percentage change in price = 20% Holding the price of manufacturing constant, suppose the price of agricultural good increases by 20% and the increase in wage is 10%.

a. What is the impact of the increase in the price of agricultural good on the rental for land and the rental for capital?

b. Explain what has happened to the real rental on land and the real rental on capital. In other words, based on your answer in a) above, why would the rental rate on land and capital change in this way?

c. If, instead of the situation considered above, the price of manufacturing was to fall by 20%, would landowners or capital owners be better off? Explain how the decrease in the price of manufacturing would affect labor income? Explain.

Texas-Q Company produces and sells barbeque grills. Texas-Q sells three models: a small portable gas grill, a larger stationary gas grill, and the specialty smoker. In the coming year, Texas-Q expects to sell 15,900 portable grills, 47,700 stationary grills, and 5,300 smokers. Information on the three models is as follows:

Total fixed cost is $1,835,220.

QUESTION 66

1. The Legal List is for

   		investment advisers
   		corporate accounts
   		fiduciaries
   		municipal finance professionals

1 points   

QUESTION 67

1. Which of the following establishes the U.S. Treasury Department as the regulator for anti-money-laundering programs?

   		SDN
   		The Bank Secrecy Act
   		None of the provided answers are correct
   		OFAC

1 points   

QUESTION 68

1. The Federal Reserve Board is responsible for which of the following?

   		Setting Regulation T
   		All provided answers are corrects
   		Printing currency
   		Easing the money supply

1 points   

QUESTION 69

1. Which of the following is rated by most securities rating services?

   		Investment risk
   		Quality
   		Market risk
   		Quantity

1 points   

QUESTION 70

1. An investor owns the following investments:

   50 New York 5-percent general obligation bonds maturing in 2020 and rated AA

   50 Florida University 6.25-percent revenue bonds maturing in 2021 and rated AA

   50 Nevada Turnpike 5.75-percent revenue bonds maturing in 2020 and rated AA

   What type of diversification does this represent?

   		Quantity
   		Maturity
   		Geographical
   		Quality

Using money creation to pay for government spending

Consider Kharkeez, a hypothetical country that produces only burgers. In 2017, a burger is priced at $2.00.

Complete the first row of the table with the quantity of burgers that can be bought with $900.

Hint: In this problem, assume it is not possible to buy a fraction of a burger, and always round down to the nearest whole burger. For example, if your calculations result in 1.5 burgers, the answer should be 1 burger.

Suppose the government of Kharkeez cannot raise sufficient tax revenue to pay its debts. In order to meet its debt obligations, the government prints money. As a result, the money supply rises by 40% by 2018.

Assuming monetary neutrality holds, complete the second row of the table with the new price of a burger and the new quantity of burgers that can be bought with $900 in 2018.

The impact of the government's decision to raise revenue by printing money on the value of money is known as the (velocity of money, fisher effect, inflation tax, classical dichotomy).

A hospital is considering building a clinic. Two years ago the board had a feasibility study done for $25,000 that indicated it was likely a profitable venture. The land would get $100,000 if sold in today’s market.  Constructing and equipping the clinic will be $4,000,000.  Management believes the center will generate17,500 visits per year.  In Year 1, revenue is expected to be $125 per visit, supply cost will be $25 per visit and labor cost (which will not vary with volume) will be $750,000.  Inflation is projected at 3% per year after that.  The hospital’s corporate cost of capital is 7.50%.

A. Construct a five-year cash flow analysis for this project (i.e. Years 0 to Year 5) and include initial cash outflows, revenue, supply cost, labor cost and net cash flow.  What is the NPV for this project? what is the volume of visits that will generate a breakeven NPV for the project?

B. If the hospital proceeds with the project, the hospital will lose about 750 visits at an existing on-site clinic. In Year 1, these visits are projected to bring in $75 per visit. How does this change, if at all, your analysis from above?

Through November, Tex has received gross income of $52,500. For December, Tex is considering whether to accept one more work engagement for the year. Engagement 1 will generate $7,450 of revenue at a cost of $3,550, which is deductible for AGI. In contrast, engagement 2 will generate $7,450 of revenue at a cost of $3,900, which is deductible as an itemized deduction. Tex files as a single taxpayer. a. Calculate Tex's taxable income assuming he chooses engagement 1 and assuming he chooses engagement 2. Assume he has no itemized deductions other than those generated by engagement 2.

b. Calculate Tex's taxable income assuming he chooses engagement 1 and assuming he chooses engagement 2. Assume he has $5,260 of itemized deductions other than those generated by engagement 2.

c. Calculate Tex's taxable income assuming he chooses engagement 1 and assuming he chooses engagement 2. Assume he has $10,400 of itemized deductions other than those generated by engagement 2.

At least two alternative investment decisions A and B refer to a ten-year investment horizon. Option A has an initial investment cost of 100,000 Euros, annual maintenance costs of 10,000 Euros and expected annual revenue of 25,000 Euros, and there is a resale value of 20,000 Euros at the end of 10 years. Solution B will require an initial investment of 120,000 Euros, will have an annual maintenance cost of 20,000 Euros and an expected annual revenue of 35,000 Euros, and now the resale value at the end of 10 years is estimated at 40,000 Euros. For a 5% bargain cost and no taxes calculated on the problem, answer the following questions:

) Which solution is more advantageous to the original data of the problem? Make the relevant financial schedules and solve the problem both with present value and annual value, with individual calculations but also with marginal analysis (PWA, PWB, PWB-A, AWA, AWB, AWB-A)

2) How does the decision change if solution A has 5 years and B has 10 years? Say how you will work with the present value and how with the annual value.