A person lends $2000 for five years at 10% per annum simple interest; then the entire proceeds are an investment for 10 years at 9% per year, compounded annually. How much money will the person have at the end of the entire 15-year period?

$7,102.09

Explanation:

SIMPLE INTEREST :

Final amount(A) =?

Principal (P) =$2000

Time(t) = 5

Rate (r) = 10% = 0.1

Recall;

Final amount on simple interest :

A = P (1 + (r×t) )

$2000 (1 + (0.1 × 5)

$2000 (1 + 0.5)

$2000 × 1.5 = 3000

Then the final amount was invested and compounded annually using the parameters :

Principal(P) = $3,000

Rate(r) =9% = 0.09

Time(t) = 10

Final amount (A) =

Recall :

A = P(1 + r) ^t

A = $3000 ( 1 + 0.09)^10

A = $3000 ( 1.09)^10

A = $3000 × 2.3673636745921

A = $7,102.09

answer: in the short-run firms will respond by raising the price of turkey.

explanation: initially the long-run equilibrium is at a price of $5 per pound of turkey and a quantity of 50 million pounds per year. now, when webmd claims that a protein found in turkey will increase your expected lifespan by 4 years. the consumers demand for turkey will increase at every price shifting the demand curve to the right from d1 to d2. while, there will be no change in the supply curve in the short-run as it is not possible for producers to adjust supply so quickly. as a result the new equilibrium will occur at a higher price and a higher quantity of turkey.

thus, in the short run firms will respond by increasing the price of turkey, selling more quantity at a higher price and earning economic profits.