Purchases of new houses are the most volatile type of expenditures because they are very sensitive to ________, which is highly volatile.
A. GDP
B. the inflation rate
C. disposable income
D. the interest rate
Answer: D
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Use the following two statements about monopolistic competition to answer this question
I. In the long run, the price of the good will equal the minimum of the average cost. II. In the short run, firms may earn a profit. A) I and II are true. B) I is true, and II is false. C) I is false, and II is true. D) I and II are false.
Suppose an investment will yield $1,000 after one year and $2,000 after two years. What is the present value of this investment if the discount rate is 8 percent?
a. $2,479.34 b. $2,640.60 c. $2,727.27 d. $3,000 e. $3,520
The neutrality of money is the idea that:
A. aggregate price levels do not affect real outcomes in the economy. B. hard money has a neutral effect in the economy. C. in real terms, it makes no difference who is spending each dollar. D. virtual money has a neutral effect in the economy.
Fiscal policy has a short implementation lag compared to monetary policy
a. true b. false