The Phillips curve describes the relationship between real GDP and inflation.
Indicate whether the statement is true or false.
Answer: False.
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If an economy has a flexible exchange rate and it chooses to issue $10 million in bonds, what will happen according to the Monetary approach?
A) It will have to allow its currency to appreciate. B) It will have to allow its currency to depreciate. C) It will have to decrease its foreign exchange reserves. D) It will have to increase its foreign exchange reserves.
If consumers have limited information about price and search costs exist, then
A) the result must be that all firms will charge the same price. B) the monopoly price must result. C) the full-information, competitive price is not an equilibrium. D) the difference in prices between firms will be greater than the search cost.
Pure economic rent is a payment to a resource that
A) has a high opportunity cost. B) has a perfectly inelastic supply. C) has a negative opportunity cost. D) has a perfectly elastic demand.
Refer to Scenario 9.6 below to answer the question(s) that follow. SCENARIO 9.6: Celeste borrowed $40,000 from her brother to open a car wash. She pays her brother a 5% yearly return on the money he lent her. Her other yearly fixed costs equal $18,000. Her variable costs equal $40,000. In her first year, Amy sold 40,000 car washes at a price of $2.50 per car wash.Refer to Scenario 9.6. Celeste's total revenue is
A. $2,000. B. $44,000. C. $60,000. D. $100,000.