Imperfect information means which of the following?
a. one party to the transaction has more information than the other party
b. buyers and sellers have all the information necessary to make an informed decision
c. buyers and sellers do not have all the information necessary to make an informed decision
d. buyers always have more information than sellers to make an informed decision
c. buyers and sellers do not have all the information necessary to make an informed decision
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To study a macroeconomy, we calculate aggregate quantities in real terms because
A) we want to get rid of the illusion of price effects. B) we want to concentrate on the production of real goods, as opposed to services. C) it is then easier to take logarithms. D) it is the only way to reconcile the three approaches to measuring GDP.
Suppose an individual has a fixed amount of wealth to allocate between consumption in two periods (c1 and c2). Any funds not spent in period 1 will earn interest (at the rate r) which will increase purchasing power in period 2 . Consider four possible reactions to an increase in r: I. c1 increases. II. c1 decreases. III. c2 increases. IV. c2 decreases. Which of these is consistent with the
hypothesis that both c1 and c2 are normal goods? a. I, II, III, and IV b. I, II, and IV, but not III c. I, III, and IV, but not II d. I, II and III, but not IV
Which of the following would lead to an increase in the supply of Russian rubles?
a. An increase in the dollar price of the ruble b. An increase in Russian GDP c. An increase in the U.S. price level relative to the Russian price level d. A decrease in the dollar-ruble exchange rate e. Expectation that the price of the ruble will rise.
In every economy people vie for the economy's rationing device, a process called
A) competition. B) entrepreneurship. C) marginal benefit. D) positive economics.