A low price-earnings ratio usually indicates that people believe that this corporation will have lower than average growth in earnings
Indicate whether the statement is true or false
True
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When competition is present and private ownership rights are clearly defined and securely enforced by the legal system, business firms will have a strong incentive to
a. innovate and develop better products and lower cost production methods. b. spend time attempting to plunder (take) the resources of others. c. engage in wasteful activities that increase the cost of producing goods and services. d. use resources during the current period rather than conserving them for the future.
Which of the following statements is true?
A) Nominal interest rate = real interest rate - expected inflation rate. B) Nominal interest rate = real interest rate + expected inflation rate. C) Real interest rate = nominal interest rate + expected inflation rate. D) Expected inflation rate = nominal interest rate + real interest rate. E) Expected inflation rate = real interest rate - nominal interest rate.
Identify the main planks of the classical thought. (4 Marks)
a. Distinguish between voluntary and involuntary unemployment. (4 Marks) b. Explain the process through which classical unemployment can occur in an economy.
If a price floor is imposed above the equilibrium price in a market, what is the effect?
a. There is no visible effect on the market outcome. b. A shortage results. c. A surplus results. d. The quantity supplied will decrease