If the price index for a retiree's consumption is set at 100 at age 65 and rises 5 percent per year, then that price index will be _____in 2 years
a. 105
b. 110.5
c. 138.8
d. 265
b
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In the long run
A) fixed costs tend to be greater than variable costs. B) variable costs tend to be greater than fixed costs. C) all costs are fixed costs. D) all costs are variable costs.
This figure displays the choices and payoffs (company profits) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the area deciding whether to charge its usual high prices or to charge very low prices, in the hopes that a new business will not be able to make a profit at such low prices. The Rock Shop is trying to decide whether or not it should enter the market and compete with MiiTunes.According to the figure, MiiTunes:
A. does not have a dominant strategy. B. has a dominant strategy to charge low prices. C. has more than one dominant strategy. D. has a dominant strategy to charge high prices.
When you start saving even a small amount early in life and continue saving for a long time (e.g., until you retire), you can build up a large “nest egg” because of:
a. compound interest. b. simple interest. c. taking big risks. d. sacrificing all the good things earlier.
Monetary policy affects the economy with a long lag, in part because
a. proposals to change monetary policy must go through both the House and Senate before being sent to the president. b. monetary policy works through changes in interest rates, and the Fed does not have the ability to change interest rates quickly. c. changes in interest rates primarily influence consumption spending, and households make consumption plans far in advance. d. changes in interest rates primarily influence investment spending, and firms make investment plans far in advance.