Suppose the current one-year interest rate is 4%. Also assume that financial markets expect the one-year interest rate next year to be 5%, and expect the one-year rate to be 6% the year after that. Given this information, the yield to maturity on a three-year bond will be approximately
A) 4%.
B) 5%.
C) 6%.
D) 15%.
B
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Suppose a glass of orange juice has a price of $2 and a glass of soft drink has a price of $1 . If the consumer is maximizing utility,
a. juice must have higher MU than soda drink b. the soft drink must have higher MU than juice c. both must have equal MU d. consumers would buy more soda drink than orange juice e. the consumer would buy twice as much orange juice as soft drink
If the price elasticity of demand within the price range $1 and $1.25 for carrots is 0.79 and for radishes is 1.6, then, within that price range
a. carrots are more price elastic than radishes b. radishes are more price elastic than carrots c. carrots and radishes must be substitute goods d. carrots and radishes must be complementary goods e. both carrots and radishes are price elastic
Suppose that Bill, a resident of the U.S., buys software from a company in Japan. Explain why and in what directions this changes U.S. net exports and U.S. net capital outflow
Clean air is an example of a public good.
Answer the following statement true (T) or false (F)