Higher saving rates mean higher future growth rates because
A. saving contributes to less investment, which yields a larger capital stock.
B. the banks have more money to distribute to their shareholders.
C. saving contributes to more investment, which yields a larger capital stock.
D. the interest earned from savings gives you more wealth.
Answer: C
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The interest rate is 5 percent. How does $500 to be received a year from today compare in value to $500 right now?
What will be an ideal response?
Under perfect capital mobility and a floating exchange rate system, expansionary fiscal policy leads to
a. an increase in income and the interest rate. b. no change in the interest rate and a fall in the trade balance. c. no change in the interest rate and a decrease in income. d. an increase in interest rates and a fall in the trade balance. e. no change in interest rates and the exchange rate.
The accompanying figure shows Becky's daily production possibilities curve for dresses and skirts.
Point Y is ________, and point V is ________.
A. inefficient; efficient B. efficient; efficient C. inefficient; inefficient D. efficient; inefficient
Different points along a downward-sloping demand curve come from
A. tangencies between indifference curves and budget lines that represent different prices of the good. B. tangencies between indifference curves and budget lines that represent different income levels. C. different points along any one budget line when the prices of the goods are held constant. D. different points along any one indifference curve when the prices of the goods are held constant.