In the short-run macro model, what is the relationship between income and investment spending?
a. It is positive and stable.
b. It is positive but unstable.
c. It is negative and stable.
d. It is negative but unstable.
e. There is no relationship between the two variables.
E
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According to U.S. law, domestic firms can obtain protection from foreign dumping, even if this protection is harmful to overall U.S. welfare
Indicate whether the statement is true or false
Tobin's model of the speculative demand for money improves on Keynes's analysis by showing that
A) the speculative demand for money is interest insensitive. B) the transactions demand for money is interest insensitive. C) people will hold a diversified portfolio. D) people will hold money or bonds but not both.
An most important service provided by underwriters is
A) lowering of information costs. B) dealing with problems of moral hazard. C) insuring firms against loss from fire. D) insuring firms against loss from employee theft.
The last time you went on a road trip, you noticed that there were several fast food outlets clustered near some freeway exits, but none at the others. Now that you are familiar with Hotelling's model, you know that the reason for this is:
A. firms vying for a favorable location. B. the existence of fast food cartels. C. zoning laws. D. failure by the firms to correctly distribute themselves.