If Homer is paid an interest rate of 2% on his savings, but the inflation rate is 12%, the real interest rate Homer earns is
A. -12%.
B. -10%.
C. 2%.
D. 14%.
Answer: B
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There is no way that externalities can be corrected
a. True b. False Indicate whether the statement is true or false
Explain how information products are "special."
What will be an ideal response?
Suppose that when the price of hamburgers increases, the Ruiz family increases their purchases of hot dogs. To the Ruiz family,
A) hamburgers and hot dogs are normal goods. B) hamburgers and hot dogs are substitutes. C) hamburgers and hot dogs are complements. D) hamburgers and hot dogs are inferior goods.
A major drawback to cost plus fixed fee contracts when compared to fixed fee contracts is _____
a. firms have an incentive to overbid b. the government must monitor the firm's costs c. the government has an incentive to award bids to the worst companies d. there is an adverse selection problem