A drop in the price of oil will result in
A. an increase in the demand for oil.
B. a decrease in the demand for oil.
C. an increase in the quantity of oil demanded.
D. a decrease in the quantity of oil demanded.
C. an increase in the quantity of oil demanded.
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If the underground economy is sizable, then GDP will:
a. accurately reflect this subterranean activity. b. overstate the economy's performance. c. understate the economy's performance. d. fluctuate unpredictably.
The coupon rate on newly issued bonds is usually ________ for bonds with favorable tax treatment, such as municipal bonds, and ________ for bonds that are very risky, such as junk bonds.
A. lower; higher B. higher; higher C. higher; lower D. lower; lower
The Federal Reserve System performs many functions but its most important one is:
Controlling the money supply Acting as fiscal agent for the U.S. government Issuing currency Providing for check clearing and collection
Homer earns $10,000 per year. Each year he spends $5,000 and saves $5,000. He pays a 5 percent sales tax on all of his spending. Assuming the sales tax is the only tax he pays, his average tax rate out of his income is
A. 3.5 percent. B. 2.5 percent. C. 0 percent. D. 5.0 percent.