Prices are useful in coordinating society's economic planning because
a. they convey information about which goods are scarce and which are plentiful.
b. economies based on price systems are more flexible than centrally planned economies.
c. economies based on price systems are more likely than centrally planned economies to minimize the cost of producing society's output.
d. All of the above are correct.
d
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Which of the following will result in secular deflation?
A) a one-time rightward shift of the long-run aggregate supply curve B) continuous rightward shifts of the aggregate demand curve C) continuous rightward shifts of the long-run aggregate supply curve D) a one-time rightward shift of the aggregate demand curve
If we look at real and nominal interest rates in the United States since 1971, we see that
A) the real interest rate has almost always been less than the nominal interest rate because of inflation. B) at times the nominal interest rate has been greater than the real interest rate and at times has been less than it. C) the difference between the nominal and real interest rates has widened during the 1990s because of inflation. D) the nominal interest rate has always been less than the real interest rate because of inflation. E) both the nominal and real interest rates were negative in the highly inflationary 1970s.
Homer has been saving to buy a new car in five years and expects that the car of his dreams will cost $35,000
If the interest rate is 8 percent per year, how much money should Homer have in his bank account today in order to have enough money to buy the car in 5 years? A) $1,852.28 B) $22,055.94 C) $23,820.41 D) $25,726.04
In general, when people talk about investing, they mean that they:
A. have lent their money to someone who will use it to buy physical capital. B. have put money in the stock market. C. hold stocks or bonds. D. All of these statements are true.