Evidence points out that since the mid-1950's just about every recession was preceded by:
A. low interest rates.
B. falling interest rates.
C. rising interest rates.
D. negative real interest rates.
Answer: C
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The present value of a payment K that is schedule to be received t periods from now is
A) K - i / (1 + i)t. B) K / (1 - i)k. C) K / (1 + i)t. D) K / (K + i)t.
Refer to Table 17-5. Oil Can Harry's, a new automobile service shop, is ready to start hiring. The table above shows the relationship between the number of mechanics the firm hires and the quantity of oil changes it produces
a. Suppose the price of an oil change is $20. Complete the table by filling in the values for marginal product and marginal revenue product. b. Oil Can Harry's is an input price-taker. Suppose the wage paid to mechanics is $80 per day. What is the profit-maximizing number of mechanics? c. Suppose the wage rate rises to $100 per day. (i) What happens to the firm's demand curve for mechanics? (ii) What happens to the profit-maximizing quantity of mechanics? d. Suppose the wage rate is $60 per day and the price of an oil change is now $15. (i) What happens to the firm's demand curve for mechanics? (ii) What happens to the profit-maximizing quantity of mechanics?
If the government increases taxes, which of the following will occur in the short run?
a. An increase in GDP, an increase in the price level, an increase in money demand and an increase in the interest rate. b. An increase in GDP, an increase in the price level, a decrease in money demand and an increase in the interest rate. c. An increase in GDP, a decrease in the price level, an increase in money demand and an increase in the interest rate. d. A decrease in GDP, a decrease in the price level, a decrease in money demand and a decrease in the interest rate. e. A decrease in GDP, an increase in the price level, an increase in money demand and a decrease in the interest rate.
When a firm has maximized profits
A) it has also minimized total costs. B) the marginal product of each input is also maximized. C) the marginal physical product is greater than the input price for all inputs. D) its marginal cost is zero.