Shocks to the macroeconomy will cause a change in the equilibrium real interest rate, except ________
A) permanent supply shocks
B) aggregate demand shocks
C) temporary supply shocks
D) all of the above
E) none of the above
C
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Expected utility is the utility that arises from expected wealth
Indicate whether the statement is true or false
Segway Corporation has a monopoly on its personal transporter, which is a scooter that carries one person. The company achieved its monopoly through the procurement of a patent. In spite of this advantage it has yet to turn a profit
One major impediment for the product is the existence of local ordinance around the country that prohibits the use of motorized scooters on sidewalks where the Segway might otherwise provide great utility to users. Where do you believe the demand curve is in relation to the average total cost? What do you believe the company's executives are banking on since they continue to stay in business even in the face of losses?
If the economy is producing ________, unemployment is at its natural rate
A) at an unemployment rate of zero B) at an inflation rate of zero C) at potential GDP D) above potential GDP
Which of the following explains why purchasing power parity may not hold perfectly in the long run?
A) Most countries have free markets with limited government regulation. B) Consumer preferences for goods and services across countries are very similar. C) Most countries do not impost trade barriers. D) Some goods and services produced in any country are not traded internationally.