Investors are often willing to pay positive prices for shares of firms that have never earned a profit because the investors

a. do not know the firms have never earned a profit.
b. expect the firms to have positive net earnings in the future.
c. expect that interest rates will rise in the future.
d. expect that higher rates of inflation will push stock prices higher in the future.


B

Economics

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Alice Hanson Jones (1980) finds that private nonhuman physical wealth in New England in 1774 was 36.4 pounds sterling per capita. Thus, assuming a capital output ratio of 3:1, Jones estimates that per capita income in New England in 1774 equaled:

a. about 9 pounds sterling. b. about 12 pounds sterling. c. about 45 pounds sterling. d. about 145 pounds sterling.

Economics

As capital per worker rises, output per worker rises. However, this increase in output per worker is smaller at smaller levels of existing capital per worker

a. True b. False Indicate whether the statement is true or false

Economics

If a hurricane were to wipe out the majority of the eastern seaboard in the United States:

A. neither the short-run nor long-run aggregate supply curves would be affected. B. only the long-run aggregate supply curve would shift left. C. only the short-run aggregate supply curve would shift left. D. the long-run and short-run aggregate supply curves would both shift left.

Economics

The change in people's purchasing power that occurs when the price of a good they purchase changes, assuming all else is held constant is known as

A) the substitution effect. B) the real income effect. C) the elasticity effect. D) the multiplier effect.

Economics