Government spending and income taxes can affect the level of
A. aggregate demand.
B. income taxes.
C. exports.
D. investment.
Answer: A
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Which of the following will shift the supply of loanable funds curve leftward?
A) a decrease in the real interest rate B) a decrease in real wealth C) a decrease in disposable income D) a decrease in expected future income
Municipal bonds have default risk, yet their interest rates are lower than the rates on default-free Treasury bonds. This suggests that
A) the benefit from the tax-exempt status of municipal bonds is less than their default risk. B) the benefit from the tax-exempt status of municipal bonds equals their default risk. C) the benefit from the tax-exempt status of municipal bonds exceeds their default risk. D) Treasury bonds are not default-free.
Refer to Table 4.2. With which scenario will you be best off by investing in Japanese bonds instead of U.S. bonds?
A) A B) B C) C D) D
In the long run under perfect competition, all firms in the same market
a. earn the same money profit b. have the same opportunity costs c. earn the same economic profit d. face the same explicit costs e. earn the same money profit and the same economic profit