For a competitive equilibrium in a two-period model, all of the following must be true except
A) each consumer picks first- and second-period consumption given the real interest rate.
B) there must be an equal number of borrowers and lenders.
C) the government's present-value budget constraint holds.
D) the credit market clears.
B
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The world rate of population growth is closest to
(a) 1%. (b) 2%. (c) 3%. (d) 4%.
If a 30 percent change in price causes a 15 percent change in quantity supplied, then the price elasticity of supply is about
a. 0.5, and supply is elastic. b. 0.5, and supply is inelastic. c. 2, and supply is inelastic. d. 2, and supply is elastic.
Other things the same, as the number of stocks in a portfolio rises,
a. risk increases and the standard deviation of the return rises. b. risk increases and the standard deviation of the return falls. c. risk decreases and the standard deviation of the return rises. d. risk decreases and the standard deviation of the return falls.
Inelastic demand displays:
A. little quantity stretch. B. considerable price stretch. C. considerable quantity stretch. D. little price stretch.