If an investor's primary stock holding is currently Exxon Mobil, the purchase of which of the following stocks would provide the investor with the largest reduction in risk?
a. BP / Amoco.
b. Shell Oil Corporation.
c. General Motors.
d. Texaco.
C
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According to the second law of thermodynamics
a. matter and energy can be neither created nor destroyed b. nature’s capacity to convert matter and energy is limited c. nothing is lost in the conversion of materials from economic activity into other forms of matter and energy d. all of the above e. none of the above
If real output in an economy is 1,000 goods per year, the money supply is $300, and each dollar is spent an average of 4 times per year, then according to the quantity equation, the average price level is
a. 3.33. b. 0.83. c. 1.20. d. 13.33.
People had been expecting the price level to be 140 but it turns out to be 138 . Johnson Family Restaurants increases the number of workers it employs. What could explain this?
a. both sticky price theory and sticky wage theory b. sticky price theory but not sticky wage theory c. sticky wage theory but not sticky price theory d. neither sticky wage theory nor sticky price theory
Suppose the real money demand function is Md/P = 2400 + 0.2Y - 10,000 (r + ?e).Assume M = 5000, ?e = .03, and Y = 5000. If the price level were to decrease from 2.5 to 2.0, then the real interest rate would decrease by how many percentage points (assuming Md, ?e, and Y are unchanged)?
A. 14 B. 5 C. 9 D. 4