Suppose the value of house T periods from now will be equal to 80T. The rate of interest onthe government bond is equal to 2%. It is optimal to sell the housea. 50 years from nowb. 40 years from nowc. Anytime between now and 100 yearsd. It is never optimal to sell the house

A lender charges a borrower an interest rate that is a percentage of the principal (the amount…

Suppose the value of house T periods from now will be equal to 80T. The rate of interest on he government bond is equal to 2%. It is optimal to sell the house 1. 50 years from now p. 40 years from now . Anytime between now and 100 years d. It is never optimal to sell the house

Suppose the value of house T periods from now will be equal to 80T. The rate of interest on he government bond is equal to 2%. It is optimal to sell the house 1. 50 years from now p. 40 years from now . Anytime between now and 100 years d. It is never optimal to sell the house

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter16: The Markets For Labor, Capital, And Land

Section: Chapter Questions

Problem 12P

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Question

Suppose the value of house T periods from now will be equal to 80T. The rate of interest on
the government bond is equal to 2%. It is optimal to sell the house
a. 50 years from now
b. 40 years from now
c. Anytime between now and 100 years
d. It is never optimal to sell the house

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