If a surplus of loanable funds exists in the loanable funds market, the real interest rate ________ and the quantity of saving ________
A) falls; increases
B) rises; decreases
C) falls; does not change
D) rises; increases
E) falls; decreases
E
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Mean reversion refers to the tendency for
A) futures prices to revert to the prices of the underlying securities. B) the long-run mean return on stocks to equal the long-run mean return on bonds. C) stocks with high returns today to experience low returns in the future and for stocks with low returns today to experience high returns in the future. D) financial analysts whose stock picks have earned above-normal returns in the past to be unable to pick stocks that will perform as well in the future.
Which of the following statements is correct?
a. Both tax avoidance and tax evasion are legal. b. Both tax avoidance and tax evasion are illegal. c. Tax avoidance is legal, whereas tax evasion is illegal. d. Tax avoidance is illegal, whereas tax evasion is legal.
Briefly explain the four rationales for efficiency wages
Suppose that the demand curve for wheat is downward sloping and the price per bushel increases from $4.50 to $5.50. We would expect:
a. The demand for wheat to increase b. The quantity demanded of wheat to decrease c. The quantity demanded of wheat to increase d. Producers to reduce the number of bushels produced