If the world real interest rate were 6% and the domestic real interest rate in Estonia was 4%, borrowers in Estonia would borrow at the rate of ________ and lenders in Estonia would lend at the rate of ________
A) 6%; 6%
B) 6%; 4%
C) 4%; 6%
D) 4%; 4%
A
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In the market for books, initially there are no taxes on books. Books are normal goods. The government introduces a tax of $4 a book and, at the same time, people's income fall by $4,000 a year
Following these two changes, the equilibrium quantity of books A) decreases. B) increases. C) remains unchanged. D) either increases or decreases. We cannot say which.
In a country that is experiencing economic growth at 7 percent per year, per capita income will double in approximately
a. seven years. b. ten years. c. fourteen years. d. twenty-one years.
Restricting imports into a small country by the government
A. increases the general welfare of the importing nation. B. protects domestic producers from foreign competition. C. increases consumer welfare in the country. D. all of the above.
Studies show that the demand for gasoline is:
A. price inelastic in the short run but elastic in the long run. B. price inelastic in both the short and long run. C. price elastic in the short run but inelastic in the long run. D. price elastic in both the short and long run.