Murray's can borrow money at a fixed rate of 10.5 percent or a variable rate set at prime plus 2.25
percent. fred's can borrow money at a variable rate of prime plus i .5 percent or a fixed rate of 12 percent.
murray's prefers a variable rate and fred's prefers a fixed rate. given this information, which one of the
following statements is correct?

a. after swapping interest rates with fred's, murray's may be able to pay prime plus 2 percent.
b. both companies can profit in a swap which will allow murray's to pay a variable rate of prime plus one percent.
c. fred's will end up with a fixed rate of 10 percent.
d. fred's has the best chance of profiting if it does an interest rate swap with murray's.
e. there are no terms under which murray's and fred's can swap interest rates.

Strawberry plants reproduce by

Each of the four independent situations below describes a sales-type lease in which annual lease payments of $12,500 are payable at the beginning of each year. each is a finance lease for the lessee. (fv of $1, pv of $1, fva of $1, pva of $1, fvad of $1 and pvad of $1) (use appropriate factor(s) from the tables provided.) situation 1 2 3 4 lease term (years) 3 3 3 3 asset’s useful life (years) 3 4 4 6 lessor’s implicit rate (known by lessee) 14 % 14 % 14 % 14 % residual value: guaranteed by lessee 0 $ 5,000 $ 2,500 0 unguaranteed 0 0 $ 2,500 $ 5,000 purchase option: after (years) none 2 3 3 exercise price n/a $ 7,500 $ 1,500 $ 3,500 reasonably certain? n/a no no yes

Self-interest achieve society’s economic goals because producers know which goods consumers want the most. as consumers and producers exercise their freedom to act in their own self-interest, markets will produce the desired goods at the lowest possible cost. consumers and producers both operate based on society’s economic goals. consumers know which goods can be produced at the lowest cost. there is a wide variety of desired goods and services in a market system because producers determine what to produce. consumers change their minds frequently. there is always a need to produce something new and improved. individual wants are diverse. what is produced is ultimately determined by consumers, because if the goods offered are not what consumers want, consumers will not buy them. producers, because they are driven by profits. producers, because they determine what to produce. consumers, because they participate in marketing surveys.