Profits and Interest Quiz

Suppose that the current rate of interest is 6%, and a particular asset will yield an annual rate of return of $1,500. The market value of this asset is...

• $9,000.
• $25,000.
• $250,000.
• $90,000.

Which of the following is usually the MOST IMPORTANT factor in determining the interest rate on a loan?

• Current technology
• Anti-usury laws
• The degree of risk involved
• The capitalized value of the borrower’s business assets

The present value of a dollar will be unaffected over time so long as...

• interest rates remain constant.
• interest rates increase to match inflation.
• interest rates decline steadily.
• none of the above.

Karl Marx would MOST LIKELY agree with which of the following statements? Profits are...

• the necessary rewards of risk-taking.
• an effective means of discouraging undesirable competition.
• an accurate measure of a society’s productive capacity.
• that part of labor’s productivity that the capitalist retains.