The proposition that the price of a resource is expected to rise at a rate equal to the interest rate is called the
A) discounted present value.
B) derived demand for productive resources.
C) diminishing marginal revenue product.
D) Hotelling Principle.
D
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If the public believes the commitment to a nominal anchor to be credible, the effect of a negative aggregate demand shock is for ________
A) short-run aggregate supply to shift up B) short-run aggregate supply to be unaffected C) short-run aggregate supply to shift down D) inflation, but not economic activity, to decrease
All of the following are examples of negative externalities except one. Which is the exception?
a. Water pollution. b. Your roommate going on a diet. c. Second-hand smoke. d. Loud conversation in the workplace.
Over a 10-year period, the Consumer Price Index doubled. On the basis of this information we can say that the average annual rate of inflation over this period was approximately:
A. 5 percent. B. 9 percent. C. 10 percent. D. 7 percent.
Which of the following is an argument that the incidence of corporate taxation falls entirely on consumers?
A. Most taxes on consumers are collected by corporations through sales taxes. B. Corporations pass their tax burdens on to consumers because consumers ultimately work for the corporations. C. Corporations always evade taxes so that consumers ultimately bear the tax burdens as taxpayers. D. Corporations pass their tax burdens on to consumers by charging higher prices equal to the amount of the tax.