Earnings of some highly skilled or highly specialized persons can be classified as economic rents
a. True
b. False
Indicate whether the statement is true or false
True
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Refer to Figure 16-1. With perfect price discrimination, the firm will produce and sell
A) Q1 units. B) Q2 units. C) Q3 units. D) Q4 units.
If a pair-wise majority vote was held to determine which school project gets funded and the voters' preferences are in the given table, who will be happiest if the lab and library are voted on first?
A. Ernie
B. Fiona
C. David
D. All people would be equally happy.
Suppose a Canadian investor buys a one-year U.S. government bond that pays 7 percent interest. If the U.S. dollar appreciates 4 percent against the Canadian dollar during the year, what must be the yield on a comparable Canadian government bond for interest rate parity to hold?
a. 3 percent b. 4 percent c. 7 percent d. 10 percent e. 11 percent
The interest rate effect suggests that
A. an increase in the price level will, reduce interest rates, and therefore reduce consumption and investment spending. B. an increase in the price level will, increase interest rates, and therefore reduce consumption and investment spending. C. nominal interest rates do not accurately measure the yield on loans unless adjusted by use of a price index. D. a decrease in the real interest rate will stimulate consumption and investment spending and therefore inflate the price level.