A good that people must actually consume before they can determine qualities is called
A) a credence good.
B) a search good.
C) an experience good.
D) a persuasive good.
Answer: C
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Technological progress makes the production possibilities frontier
A) shift inward toward the origin. B) become more linear and less bowed. C) shift outward from the origin. D) become less linear and more bowed.
A bond purchaser bought a bond from which she receives $800 a year from the issuer. If the face value of the bond is __________ then the coupon rate is __________.
A. $10,000; 10 percent B. $8,000; 8 percent C. $10,000; 8 percent D. $8,000; 12 percent E. none of the above
A study has estimated the effect of changes in interest rates and consumer confidence on the demand for money to be: ln M = 14.666 + .021 ln C ? 0.036 ln r, where M denotes real money balances, C is an index of consumer confidence, and r is the interest rate paid on bank deposits. Based on this study we know that the interest elasticity is:
A. very inelastic. B. unitary. C. zero. D. very elastic.
Refer to the information provided in Figure 7.9 below to answer the question(s) that follow. 
Figure 7.9Refer to Figure 7.9. The firm is currently along isocost CD. If the price of labor is $42, then the price of capital is
A. $21. B. $42. C. $63. D. $84.