Problem 1) Which of the following are capital and which are not. Explain
a) video poker game machine at a local bar that takes quarters.
b) a $10 bill
c) A college education
d) The Golden Gate Bridge.
e) The shirts on the rack at Sears.
f) A government bond.
g) The Empire State Buliding.
h) A savings account
i) The Washington Monument
j) A Honda plant in Marysville, Ohio
Problem 2. True or False and Explain
a) Savings and investment are juse two words for the same thing
b) When I buy a share of Microsoft stock I have invested; when I buy a government bond I have not.
c) Higher interest rates lead to more investments because those investments pay a higher return.