Refer to the information provided in Figure 30.1 below to answer the question(s) that follow.
Figure 30.1Refer to Figure 30.1. If the economy is currently at Point C, pessimism about future growth in aggregate output moves the economy to Point
A. E.
B. B.
C. C.
D. D.
Answer: A
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In the above figure, if the real interest rate is 8, there is
A) underproduction in this economy. B) a surplus of loanable funds. C) a shortage of loanable funds. D) a shortage in available funds for investment.
A decline in the price of a bond causes the yield of the bond to
A) rise. B) fall. C) remain unchanged. D) rise if it's a short-term bond, fall if it's a long-term bond.
Which of the following statements are true regarding profit maximizing firms? a. They will attempt to maximize the difference between total revenues and total costs. b. They will use more of a resource as long as the MRC is greater than the MRP
c. They will only produce where MRP is positive and MRC is negative. d. none of the above.
The interest rate that banks charge when they lend each other their excess reserves is called the _____ rate.
Fill in the blank(s) with the appropriate word(s).