Suppose You Inherit an Orange Grove and It Generates an Annual

Multiple Choice

Suppose you inherit an orange grove and it generates an annual return of $16,000. You want to sell it. The interest rate is 8 percent. If the government imposed an interest rate ceiling at 10 percent, the ceiling would cause the price of your grove to

A) go down
B) go up
C) stay the same
D) be irrelevant because you would be unable to sell the grove at any price when the price ceiling is higher than the interest rate
E) not enough information given