The real rate of interest is
A. the average rate of interest over the last 20 years.
B. the nominal interest rate minus the anticipated rate of inflation.
C. the interest rate received by the lender minus the handling charges of the loan.
D. the interest rate actually paid explicitly by the borrower.
Answer: B
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Voting members of the Federal Open Market Committee are
A) the Board of Governors, the presidents of five Federal Reserve Banks, and the Comptroller of the Currency. B) the Board of Governors and presidents of five Federal Reserve Banks. C) the Board of Governors and all twelve Federal Reserve Bank presidents. D) the Board of Governors, all twelve Federal Reserve Bank presidents, and the Secretary of the Treasury.
The above figure shows four different markets with changes in either the supply curve or the demand curve. Which graph best illustrates the market for coffee after severe weather destroys a large portion of the coffee crop?
A) Graph A B) Graph B C) Graph C D) Graph D
Mario's Pizza and Bella's Pizza are in tacit collusion to cooperate and each charge a high price for their pizzas. If Mario's Pizza initially cooperates with Bella's Pizza, but then switches and charges a low price and Bella's Pizza responds by forever charging a low price, this is an example of ________.
A) a trigger strategy B) a tit-for-tat strategy C) a one -shot game D) an end-period problem
Suppose workers expect the inflation rate to be 3.6 percent and they receive a nominal wage increase of 7.5 percent. If the actual inflation rate turns out to be 2.8 percent, workers will receive a lower real wage than expected
a. True b. False Indicate whether the statement is true or false