Just as the gavel is about to come down on an interest rate, Ask an Expert

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Just as the gavel is about to come down on an interest rate of 20% a Crusoe arrives with news. Is the news good or bad? If the Crusoes rerun the auction will the rate rise or fall?

(a) Fertilizer has just been discovered, and using it will raise he rate of return on any plot by 8 percentage points.

(b) Half the wheat stock is rotten and cannot be eaten or planted.

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Financial Management, Finance

Category:- Financial Management
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