1. A publisher is deciding whether or not to invest in a new printer. The printer would cost $900, and would increase the cash flows in year 1 by $500 and in year 3 by $800. Cash flows do not change in year 2. If the interest rate is 12%

If the interest rate rises to 25% would the investment still take place?An advantage of capitalism is that

a)	No since the present value of the cash flows is lesser than zero

b)	Yes since NPV>0

c)	Yes since the present value of the cash flows is greater than zero

d)	No since NPV<0

2. An advantage of capitalism is that

a)	It allows the market to self-regulate and clear itself

b)	It allows a person to follow his or her own self interest

c)	It allows voluntary transactions, which create wealth

d)	All of the above

3. Marginal productivity is

a)	The extra output associated with total inputs

b)	The total output associated with total inputs

c)	The total output associated with extra inputs

d)	The extra output associated with extra inputs

4. Which of the following is the foundation for success for a company facing competition

a)	Create an advantage over the competition

b)	Protect the advantage created over the competition

c)	Create and protect advantages over the competition

d)	None of the above

5. A product can be classified as an inferior good if an increase in the income causes

a)	A decrease in the quantity demanded

b)	An increase in demand

c)	A decrease in demand

d)	An increase in the quantity demanded.