When a transfer price increases
a. the profits of the division producing the intermediate product will rise
b. the profits of the division producing the intermediate product will fall
c. the costs of the division producing the intermediate product will rise
d. the costs of the division producing the intermediate product will fall
a
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According to modern economists, the velocity of money is affected by
a. interest rates and expected price changes. b. expected price changes only. c. interest rates only. d. neither interest rates nor expected price changes.
The formula for determining a real variable is real variable =
a. (nominal variable ? 100) ? CPI b. (nominal variable ? CPI) ? 100 c. (nominal variable ? price index) ? 100 d. (nominal variable ? price index) + 100 e. (nominal variable ? price index) ? 100
A car sells at different prices at different dealerships in a local market. If a consumer has imperfect information about the price of a car at each dealership, he should
a. always gather all available information about prices. b. gather information about prices until the expected marginal benefit of more information equals the marginal cost of gathering it. c. gather information about prices only if it can be gathered without cost. d. ignore information about prices because it is irrelevant to making an "optimally imperfect" decision.
Reductions in transportation costs help explain the increase in U.S. trade flows
a. True b. False Indicate whether the statement is true or false