Refer to Table 12.1. Assuming the inflation rate forecast to be accurate, which nation would pay the highest nominal rate of return?
A) Brazil B) South Africa C) Australia D) the United States
A
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If government spending and the price level increase, then
A) the interest rate decreases, consumption increases, and investment spending increases. B) the interest rate decreases, consumption declines, and investment spending declines. C) the interest rate increases, consumption declines, and investment spending declines. D) the interest rate increases, consumption increases, and investment spending increases.
What key assumption for perfect competition would lead you to believe that fast food is not a perfectly competitive industry explain why.
The dividend-discount model of stock valuation:
A. takes the annual dividend, adds it to the expected future selling price and divides by the number of years to get the current price. B. is an application of the net present value formula. C. takes the net present value of the expected future price of the stock and adds the annual dividend. D. takes the net present value of expected dividends and add it to the future sale price of the stock.
Suppose farmers can use their land to grow either wheat or corn. The law of supply predicts that an increase in the market price of wheat will cause farmers to:
A. raise the production of wheat and corn. B. lower the production of corn and wheat. C. substitute corn for the production of wheat. D. substitute wheat for the production of corn.