The real interest rate
A) can never be negative.
B) is approximately equal to the nominal interest rate plus the inflation rate.
C) is approximately equal to the nominal interest rate minus the inflation rate.
D) is positively related to the inflation rate.
C
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In 1991, Argentina established a radical institutional reform after experiencing a decade marked by financial instability. This program was called the new Convertibility Law. What did this law do?
A) made Argentina's currency fully convertible into Eurocurrency at a fixed rate B) required that the monetary base be backed completely by U.S. dollars C) placed limits on exports of commodities D) made Argentina's currency fully convertible into U.S. dollars at a fixed rate and required that the monetary base be backed completely by gold or foreign currency E) restricted risky international trade activity
According to the rational expectations school,
a. the Phillips curve is upward sloping in the short run and downward sloping in the long run b. both for the short and long runs, the Phillips curve is horizontal c. both for the short and long runs, the Phillips curve is vertical d. there is no Phillips curve e. Keynesians assume irrational expectations behavior on the part of firms and individuals that allows them, erroneously, to conclude that there are no trade-offsbetween inflation and unemployment
The principle that "people face tradeoffs" applies to
a. individuals. b. families. c. societies. d. All of the above are correct.
Perfect price discrimination:
A. creates no deadweight loss. B. maximizes producer surplus. C. eliminates all consumer surplus. D. All of these statements are true.