Suppose y = k1/2, total factor productivity is constant and equal to 1, s = 0.40, and d = 0.10. When the economy reaches the steady state, consumption per worker is ________
A) $1.20
B) $2.40
C) $4.80
D) $13.60
B
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Which of the following is a tool the Fed uses to adjust the quantity of money?
i. The Fed can change the interest rate banks charge for loans to their prime customers. ii. The Fed can change the discount rate on loans to banks. iii. The Fed can buy or sell government securities. A) i only B) ii only C) iii only D) i and iii E) ii and iii
Research has shown that most economic profits from selling a prescription drug are eliminated 20 years after the drug is first offered for sale. The main reason for the elimination of profits is
A) firms sell their patent rights to other firms so that they can concentrate on finding drugs to treat new illnesses. B) after 20 years patent protection is ended and other firms can produce less-expensive generic versions of the drug. C) the quantity demanded of the drug has increased enough that the demand becomes inelastic and revenue falls. D) after 20 years most people who have taken the drug have passed away or are cured of the illness the drug was intended to treat.
If people expect the price of packaged coffee to rise next week, coffee demand will:
a. decrease now. b. increase now. c. stay the same now and increase next week. d. stay the same now and decrease next week. e. stay the same now and next week.
Investment is _________ related to the interest rate, and NCO is __________ related to the interest rate.
A. negatively; negatively B. negatively; positively C. positively; positively D. positively; negatively