A car's real cost is its opportunity cost. Opportunity cost is determined by
A. wealth.
B. the price of the car.
C. relative prices.
D. the prices of the goods that are compliments to a car.
Answer: C
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The benchmark default-free interest rate of the financial system is generally considered to be:
A) the federal funds rate B) the interest rate on the 10-year Treasury note C) the discount rate D) the 30-year fixed rate mortgage
On the Solow Diagram, an increase in the saving rate is shown by ________
A) an upward shift of the depreciation line B) an upward shift of the investment function C) an upward shift of the per-worker production function D) a downward shift of the investment function
Regarding the Interstate Commerce Commission (ICC),
(a) historians agree that it was primarily "captured" by the industry that it was supposed to regulate. (b) historians agree that it was primarily "captured" by passengers and shippers to the disadvantage of the railroads. (c) historians generally agree that it was not "captured" by any group, but rather served the public well. (d) historians do not "agree" on any of the above.
For more than 20 years, the Fed has used the federal funds rate as its monetary policy target. It has not targeted money supply at the same time because the
A. Fed does not have the authority to control both targets B. Fed cannot target both at the same time: it has to choose between targeting an interest rate and targeting the money supply C. Fed can target both at the same time, but it has chosen to target the interest rate as it is more reliable as a target