If Cathy has a bond that will pay $1,000 one year from now and its current price is $800, what is the current interest rate?
a. 10 percent
b. 25 percent
c. 20 percent
d. 200 percent
e. 2 percent
B
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When the price of running shoes goes from $100 to $80, the quantity demanded increases from 20 to 30 million. Over this price range, the absolute value of the price elasticity of demand is
a. 0.55. b. 1. c. 1.25. d. 1.80. e. 2.50.
A fixed exchange rate is an exchange rate whose value:
A. reflects the comparative advantage of the home country versus other foreign countries. B. is established annually by the International Monetary Fund. C. varies according to supply and demand for the currency in the foreign exchange market. D. is set by official government policy.
Explain how it is possible for one of two people in a two-good economy to have an absolute advantage in producing both goods, but trade can still benefit both people
What will be an ideal response?
According to the Keynesian framework, which of the following will not help a country to get out of a recession, but may help that country reduce inflation?
a. an increase in military spending b. a decrease in military spending c. increase in spending by the government on health care d. decrease in federal government taxation of personal income