Inflation that is ________ than what is expected benefits ________ and hurts ________
A) greater; lenders; no one B) greater; lenders; borrowers
C) less; lenders; borrowers D) less; borrowers; lenders
C
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Which of the following statements is TRUE?
A) A perfectly competitive market produces more output and charges a lower price than a single-price monopoly. B) A perfectly competitive market produces more output and charges the same price as a single-price monopoly. C) A perfectly competitive market produces less output and charges a lower price than a single-price monopoly. D) A perfectly competitive market produces less output and charges the same price as a single-price monopoly.
Suppose the price of an item in a perfectly competitive market is $3. For a firm in this market, MC = MR at an output of 100 units. The average total cost at this output level is $4 per unit, and TVC is $80. We may conclude that
A) the firm should shut down because TC > TR. B) the firm should continue to produce because P>AVC. C) the firm should shut down because its TFC is $320 and its TC is $400. D) the firm should shut down because other firms will enter the industry as the market is perfectly competitive.
Domestic saving must equal domestic investment in
a. both closed and open economies. b. closed, but not open economies. c. open, but not closed economies. d. neither closed nor open economies.
An expansionary monetary policy may cause asset prices to rise, thereby reducing the likelihood of financial distress and causing consumer durable and housing expenditures to rise. This monetary transmission mechanism is referred to as
A) the household liquidity effect. B) the wealth effect. C) Tobin's q theory. D) the cash flow effect.