Eliza wants to borrow $100 from Sandy. Sandy wants to make 4% real return on his money, so they both agree on a 4% interest rate paid next year. Eliza and Sandy did not anticipate any inflation, yet the actual inflation turned out to be -5% next year. In this case
A. Eliza will pay an 9% real interest rate.
B. Eliza will pay a 4% nominal interest rate.
C. Sandy is better off.
D. all of the above.
Answer: D
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The ________ specializes in making long-term loans for capital investment projects that do not have private financial support
A) International Monetary Fund B) Federal Reserve Bank C) World Bank D) European Central Bank
For consumers, goods A and B are complementary goods. The cost of a resource used in the production of A decreases. As a result
A) the equilibrium price of B will fall and the equilibrium price of A will rise. B) the equilibrium price of B will rise and the equilibrium price of A will fall. C) the equilibrium prices of both A and B will rise. D) the equilibrium prices of both A and B will fall.
Why isn't slope as useful as elasticity to measure the responsiveness of one variable to another?
What will be an ideal response?
Which of the following is correct? a. "Theory" and "hypothesis" are interchangeable terms meaning the same thing. b. A hypothesis may result from a tested and confirmed theory
c. A theory may result from a tested and confirmed hypothesis. d. A hypothesis is a theory whose formulation relies on mathematics.