You want to make a 10% real return on a loan that you are planning to make, and the expected inflation rate during the period of the loan is 4%. You should charge a nominal interest rate of
A. -6%.
B. 6%.
C. 10%.
D. 14%.
Answer: D
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The lower the price of the good measured on the vertical axis, other thing remaining the same, the flatter the budget line
Indicate whether the statement is true or false
Which of the following decreases in labor demand is due to a change in the price of a related resource?
A. A decline in the demand for computers in Europe reduces the demand for workers in the domestic computer industry. B. The rise of hair salons for both men and women reduces the demand for barbers. C. A decrease in the educational skills of manufacturing workers decreases the demand for such workers. D. An increase in the price of chemical equipment increases the cost of producing fertilizer, thus decreasing the demand for workers who make fertilizer.
A good example of a monopolistic competitive industry is
A. the federal highway system B. wheat farms in the United States. C. the four major textbook publishers together with nearly 90 percent of industry sales. D.the country music industry.
Which of the following is likely to decrease the supply of U.S. dollars in the forex market?
A. If investors' confidence in foreign economies increases B. If U.S. consumers prefer foreign goods to U.S. goods C. If foreign interest rates are low relative to U.S. interest rates D. All of these will increase the supply of U.S. dollars.