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In Firm A, the profit for the current year is 114. Suppose Firm A plans to rent its machinery at the real rate of interest.
In Firm A, the profit for the current year is 114. Suppose Firm A plans to rent its machinery at the real rate of interest. The current price of the machinery is 30 ~ 114, the real rate of interest is 1% per year of the current price, and the rate of depreciation is 5% per year of the current profit. On the basis of static expectations, the expected present value of profits is 2.86 x Ty (Round your answer to two decimal places.) (Properly format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a subscript can be created with the_ character.) Suppose Firm A is planning to invest in a machinery today that yields a profit of 200 in year t + 1. The constant rate of depreciation is 10% per year, the real rate of interest is 2% for year t + 1, and this rate increases by 20 basis points every year (1% = 100 basis points). = The expected present value of the profit for year t+5 is el assuming that the profit increases at a rate of 5% per year. (Round your answer to two decimal places.) In Firm A, the profit for the current year is 114. Suppose Firm A plans to rent its machinery at the real rate of interest. The current price of the machinery is 30 ~ 114, the real rate of interest is 1% per year of the current price, and the rate of depreciation is 5% per year of the current profit. On the basis of static expectations, the expected present value of profits is 2.86 x Ty (Round your answer to two decimal places.) (Properly format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a subscript can be created with the_ character.) Suppose Firm A is planning to invest in a machinery today that yields a profit of 200 in year t + 1. The constant rate of depreciation is 10% per year, the real rate of interest is 2% for year t + 1, and this rate increases by 20 basis points every year (1% = 100 basis points). = The expected present value of the profit for year t+5 is el assuming that the profit increases at a rate of 5% per year. (Round your answer to two decimal places.)
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