In the Interest Parity Condition, Rt - R t = ( - Et)/Et + xt, where Rt - R t is the interest rate differential and ( - Et)/Et is the expected change in the exchange rate, what does xt stand for if it potentially is a market efficient difference
between the two? A) market inefficiency
B) risk premium
C) forecast error
D) tracking error
E) excessive volatility
B
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If the price of chicken rises from $1.25 per pound to $1.75 per pound, if the demand curve is consistent with the law of demand, then the quantity of chicken demanded would be predicted to go from
A. 100 pounds to 125 pounds per day. B. 100 pounds to 75 pounds per day. C. 100 pounds to 100 pounds per day, because the price of chicken does not affect the quantity demanded. D. 100 pounds to 0 pounds per day, because consumers would stop purchasing chicken at a price above $1.25 per pound.
Long-term public debt is available in the form of
a. paper currency b. stocks and bonds c. Treasury notes and bonds d. Treasury bills e. tax abatements
The income that households and noncorporate businesses receive is called
a. personal income. b. net national product. c. disposable personal income. d. national income.
If Kobe, an NBA star athlete, earns $10 million per year but has no money in the bank, he has a
A. high income and high wealth. B. low income and high wealth. C. high income and low wealth. D. low income and low wealth.