Suppose it is discovered that consumption of chocolate leads to a longer life. This information would lead to
A) an increase in quantity demanded of chocolate.
B) an increase in demand for chocolate.
C) a decrease in quantity demanded of chocolate.
D) a decrease in demand for chocolate.
Answer: B
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The fixed rate in a swap contract is
A) a certain short rate in the market when the contract is signed. B) a certain long rate in the market when the contract is signed. C) negotiated by the parties in the contract. D) the difference between stated long and short rates when the contract is signed.
New growth theory is concerned with
A) finding a good way to measure economic growth. B) increasing the savings rate in the U.S. C) understanding the forces that increase productivity. D) understanding how compounding works.
Inflation is an increase in the average level of prices of goods and services.
Answer the following statement true (T) or false (F)
Answer the following statements true (T) or false (F)
1. An expansionary monetary policy is less effective in influencing aggregate demand compared to a restrictive monetary policy. 2. Monetary policy, unlike fiscal policy, does not have any time lags. 3. The major advantages of monetary policy include its flexibility, speed, and political palatability. 4. The effects of expansionary monetary policy are strengthened by a liquidity trap.