Answer:
a. $1(1 + .05)^16
Explanation:
The discounting of an amount today at an interest rate for a specific period of time is given by
A = P(1 + r)^n
where
A = Future amount
P = present amount
r = rate in percent
n = time
Therefore, the future value of $1 put into an account that earns 5 percent interest for 16 years
= $1(1 + 0.05)^16
As P = $1, r = 5% and n = 16. Option a.
Answer:
trade diversion
Explanation:
Trade diversion results from changing an efficient supplier or trading partner for a not so efficient trading partner. This change usually results from trade agreements or customs unions like NAFTA (or USMCA) or the European Union that benefit less efficient producers.
Trade diversion results in concentrating production in countries with high opportunity costs that do not possess real comparative advantages, but rather political advantages.
They are buying a souvenir.
