The real rate of interest is defined as
A. zero.
B. the nominal rate of interest.
C. the nominal rate of interest plus the anticipated inflation rate.
D. the nominal rate of interest minus the anticipated inflation rate.
Answer: D
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The income approach measures GDP by summing
A) the wealth of households, business and government. B) the incomes paid households for the resources they own. C) the total production of all final goods and services produced in a year within a country's borders. D) C + I + G + NX. E) Both answers A and D are correct.
If a monopoly is able to perfectly price discriminate, then consumer surplus is
A) equal to zero. B) maximized. C) unchanged from what it is with a single-price monopoly. D) unchanged from what it is in a perfectly competitive industry. E) not zero but is less than with a single-price monopoly.
An important function of international institutions during times of crisis is to
A) make goods nonrival. B) make goods nonexcludable. C) prevent free riding. D) prevent nondiscrimination. E) encourage free riding.
Given the level of real GDP, the equilibrium level of the interest rate depends on the
A) demand for money. B) monetary-fiscal policy mix. C) size of the multiplier. D) extent of crowding out.