If inflation is 10% and the nominal interest rate equals 16.6% the real interest rate is equal to
A) 6.6%.
B) 6%.
C) -6.6%.
D) zero.
B
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Raising an existing tariff on grapes from Chile will: a. increase U.S. imports of Chilean grapes
b. decrease U.S. consumption of domestically produced grapes. c. decrease total U.S. consumption of grapes. d. do all of the above.
To ration a good means that
a. some distribution mechanism replaces price to determine who gets what quantity of goods b. the government owns all the resources used to produce the good c. the government purchases the goods not sold on the market d. a price floor has been imposed e. the supply of the good is greater than the demand
The aggregate supply curve slopes upward because firms
a. seek to maximize profits and output. b. normally can purchase inputs at fixed prices. c. employ technology, which is always fixed. d. purchase inputs whose prices rise as output rises.
The labor market is a market in which:
A. labor supply and labor demand alone determine wages and employment. B. firms determine the supply of labor. C. the invisible hand operates unimpeded by other forces. D. social and political pressures are particularly strong.