According to the efficient markets hypothesis, the current price of a financial security
A) is the discounted net present value of future interest payments.
B) is determined by the lowest successful bidder.
C) fully reflects all available relevant information.
D) is a result of none of the above.
C
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In modern economies
A) some prices are very flexible while others are not. B) no prices are very flexible. C) all prices are very flexible. D) prices become less flexible as they increase.
The fraction of a change in disposable income that is spent on consumption is the
A) marginal propensity to consume. B) marginal dissaving ratio. C) expected future disposable income. D) marginal buying power of money. E) marginal propensity to dissave.
Suppose the working-age population of a fictional economy falls into the following categories: 90 are retired or homemakers; 60 have full-time employment; 20 have part-time employment; 20 do not have employment, but are actively looking for
employment; and 10 would like employment but do not have employment and are not actively looking for employment. The official unemployment rate as calculated by the U.S. Bureau of Labor would equal A) (30/80 ) × 100. B) (20/60 ) × 100. C) (20/100 ) × 100. D) (20/80 ) × 100.
Consider an apple orchard owner deciding how to incentivize his fruit pickers. He pays per pound harvested but adjusts the compensation rate higher during poor harvest seasons. As a consequence
a. The picker's effort would not depend on the compensation rate b. The pickers would claim poor harvests in order to be paid higher piece rates even during bountiful harvest seasons c. The pickers would claim good harvests in order to be paid higher piece rates even during poor harvest seasons d. None of the above