Bob deposits $100 in a bank account that pays an annual interest rate of 5 percent. A year later, Bob withdraws his $105 . If inflation was 7 percent during the year the money was deposited, then Bob's purchasing power has increased by 2 percent
a. True
b. False
Indicate whether the statement is true or false
False
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Kate and Alice are small-town ready-mix concrete duopolists. The market demand function is Qd = 20,000 - 200P where P is the price of a cubic yard of concrete and Qd is the number of cubic yards demanded per year. Marginal cost is $80 per cubic yard. Suppose Kate enters the market first and chooses her output before Alice. What is Alice's profit maximizing output?
A. 2,000 B. 1,333.34 C. 1,000 D. 4,000
A risk-averse individual has
A) an increasing marginal utility of income. B) an increasing marginal utility of risk. C) a diminishing marginal utility of income. D) a diminishing marginal utility of risk. E) a constant marginal utility of income, but a diminishing marginal utility of risk.
Which of the following statements is TRUE about the long-run and short-run aggregate supply curve in the classical model?
A) The long-run aggregate supply curve is vertical, and the short-run curve is horizontal. B) The long-run aggregate supply curve is not defined, and the short run curve is vertical. C) The long-run and short-run curves start out horizontal and eventually become vertical. D) The long-run curve is vertical, and there is no short-run curve since all adjustments occur quickly.
Over the past 50 years, the amount given in aid has __________ in dollar terms, ___________ in terms of aid as a share of GDP.
A. increased; but has steadily fallen B. increased; as well as increased C. decreased; but has increased D. decreased; and has steadily fallen