The benchmark interest rate that banks use as a reference point for a variety of consumer and business loans is the:
A. federal funds rate.
B. prime interest rate.
C. discount rate.
D. Treasury bill rate.
B. prime interest rate.
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According to Okun's Law, if the natural unemployment rate is 5 percent, the actual unemployment rate is 4 percent, and potential GDP is $15 trillion, then actual real GDP is
A) $14.7 trillion. B) $15.4 trillion. C) $15.0 trillion. D) $12.0 trillion. E) $15.3 trillion.
Of the two conflicts, __________ get(s) more severe the larger the firm
A) the stockholder-lender conflict B) manager-stockholder conflict C) both D) neither
In the real world, demand is not likely to be perfectly inelastic at every price because
a. no substitutes exist for some goods b. some consumers will be unable to afford very high prices with given incomes c. at low prices, consumers always want a lot d. consumers are willing to pay any price for certain goods e. the prices of certain goods don't change
Which statement is true?
A. Joseph Schumpeter said, "risk bearing is no part of the entrepreneurial function." B. Benjamin Franklin said, "It is better to borrow than to lend." C. Aristotle said, "the fair rate of interest is exactly what the market will bear." D. David Ricardo said, "the landlord's return, rent, should be taxed away by the government."