The expected real interest rate (re) in terms of the nominal interest rate (R) and the expected inflation rate (?e) is given by
A) re = ?e + R.
B) re = 2?e + R2.
C) re = ?e + R2.
D) re = R - ?e.
E) re = R2 - ?e.
D
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Bill is working as the only employee at a local store. The relation between Bill and the owner of the store is such that Bill is ________ and the owner is ________
A) the agent; the principal B) both principal and agent; neither a principal nor an agent C) neither a principal nor an agent; both principal and agent D) the principal; the agent
In an analysis of an excise tax on soda, which of the following is an exogenous variable?
a. The price received by sellers. b. The price paid by buyers. c. The quantity exchanged in the market. d. The tax.
An explanation for why the short-run aggregate supply curve is upward-sloping is because:
A. ?the quantity of real output supplied is inversely related to the aggregate supply curve. B. ?nominal incomes are fixed. C. ?the capital-output ratio is fixed. D. ?an increase in price will increase the marginal aggregate output.?
In the contemporary U.S. economy, the best example of fiat money would be
A) coins issued by the U.S. Treasury. B) deposits at all depository institutions. C) deposits at commercial banks, but not deposits at other depository institutions. D) Federal Reserve Notes.