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The Firm in the Table Below Produces Denim Jeans and Each

Question 28

Multiple Choice

The firm in the table below produces denim jeans and each unit of capital represents one sewing machine.The MRP for each of machines 10 through 14 is provided.Each sewing machine delivers a stream of MRPs beginning one year from now,for a total of 2 years.Assume that after 2 years each sewing machine is worth nothing.  Number of  Sewing Machines  Annual MRP 10$200011$180012$160013$140014$1200\begin{array} { | c | c | } \hline \begin{array} { c } \text { Number of } \\\text { Sewing Machines }\end{array} & \text { Annual MRP } \\\hline 10 & \$ 2000 \\\hline 11 & \$ 1800 \\\hline 12 & \$ 1600 \\\hline 13 & \$ 1400 \\\hline 14 & \$ 1200 \\\hline\end{array} TABLE 15- 2
-The present value of a given future stream of benefits will be lower when the benefits are and the interest rate is .


A) equalized over a ten- year period; zero
B) more distant in time; lower
C) nearer in time; lower
D) more distant in time; higher
E) accruing in the first time period only; lower

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