According to the new Keynesian sticky-price theory, a rise in aggregate demand results in ________ price level in the near term and in ________ price level in the longer term.
A. a lower; an unchanged
B. a lower; a higher
C. a higher; an unchanged
D. an unchanged; a higher
Answer: D
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If the demand for a good is relatively inelastic, this means that consumer purchases of the good are
a. not very sensitive to the price of the good. b. highly sensitive to the price of the good. c. unrelated to the price of the good. d. unaffected by changes in the income level of consumers.
To diversify, a homeowner with a variable-rate mortgage should choose investments that
a. pay higher returns when interest rates rise and lower returns when interest rates fall. b. pay lower returns when interest rates rise and higher returns when interest rates fall. c. provide a higher return than the market average. d. provide a lower return than the market average.
If the United States imposes tariffs on lumber imported from Canada, making lumber more expensive, what will happen to the price of new homes in the U.S. assuming lumber is a major input in the construction of new homes?
A. There is no way to know B. the price will decrease C. The price will increase
As of 2005 the European Union had:
a. 5 members. b. 15 members. c. 25 members. d. 40 members.