If a corporation borrows capital for a specified period of time at an agreed-upon interest rate, this is a
a. common stock
b. preferred stock
c. convertible stock
d. bond
e. double tax
D
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If your income increases, what is the effect on your budget line?
What will be an ideal response?
Under a system of pollution taxes, we expect firms to cut pollution until the marginal benefit from tax savings equals the marginal increase in production costs due to decreasing pollution.
Answer the following statement true (T) or false (F)
One key implication of rational expectations is that
A. anticipated monetary policy cannot affect the level of real Gross Domestic Product (GDP). B. anticipated monetary policy has no effect on the price level. C. both unanticipated monetary policy and anticipated monetary policy have an effect on the economy. D. unanticipated monetary policy has no effect on the economy but anticipated monetary policy does have an effect on the economy.
If a firm is a union shop, then
A. only workers who have been union members for two years may be employed. B. a worker may elect to either join or not join the union. C. only union members may be employed by the firm. D. a non-union worker may be hired but must join the union within a certain time period.