The interest rate is:
A. only a return to borrowers.
B. both a cost to savers and a return to borrowers.
C. both a return to savers and a cost to borrowers.
D. a cost to both savers and borrowers.
E. only a cost to savers.
Answer: C. both a return to savers and a cost to borrowers.
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A decrease in the price of a complement in production leads to
A) no change in the supply of the good in question. B) an increase in the supply of the good in question. C) a decrease in the supply of the good in question. D) a decrease in the quantity supplied of the good in question. E) an increase in the supply of the good in question and a decrease in the quantity supplied of the good in question.
Suppose households decide to reduce savings because they want to enjoy more present time than future time. In this case, the loanable funds model predicts that
A) interest rate goes down, and quantity of borrowed funds increases. B) interest rate goes down, and quantity of borrowed funds decreases. C) interest rate goes up, and quantity of borrowed funds decreases. D) interest rate goes up, and quantity of borrowed funds increases.
If 1 U.S. dollar exchanges for 7.0 Chinese Yuan, how much would it cost in U.S. dollars and cents to purchase a Chinese toy priced at 140 Yuan?
What will be an ideal response?
John is a seller in an affiliated-values auction environment where bidders are risk neutral. Which auction yields John the greatest expected revenue?
A. English B. Second price C. First price D. All of the choices are revenue equivalent.