If the income elasticity of money demand is 3/4 and the interest elasticity of money demand is -1/4, by what percent does money demand rise if income rises 10% and the nominal interest rate rises from 4% to 5%?
A) 7.50%
B) 6.25%
C) 5.00%
D) 1.25%
D
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According to this Application, for approximately 12 million homeowners in 2012, the amount owed on mortgages was higher than the actual value of the homes. These homeowners used borrowed funds to purchase their homes, a practice known as
A) acceleration. B) securitization. C) leverage. D) liquidity.
A venture capital fund wants to invest $1000 in each of one thousand mad scientists
The first scientist applying to the fund is working on the legendary pill that turns water into gasoline, and the second scientist is working on the even more legendary perpetual motion machine. The smart venture capitalist here will A) back the pill and look for 999 other scientists working on the same pill. B) back the machine and look for 999 other scientists working on the same machine. C) look for 500 scientists working on the pill and 500 working on the machine. D) back the pill, the machine, and 998 other different projects.
The Solo Coal Mine is the only employer in the small town of Way out there. The market supply of coal miners is Qs = 0.02W - 200, where W is the annual wage of a coal miner and Q is the number of people who would accept employment as a coal miner. What is the coal mine's marginal expenditure when it hires 150 coal miners?
A. $17,500 B. $30,500 C. $10,000 D. $25,000
The production possibilities curve of a low income country lies outside the production possibilities curve of a high income country
a. True b. False Indicate whether the statement is true or false