In lesser-developed countries (LDCs), interest rates are usually much higher than in developed economies. A reason that is consistent with your understanding of interest rate determination is
a. people in LDCs save at a much higher rate
b. there are fewer businesses in LDCs, so demand is lower
c. consumers in LDCs are less willing to postpone present consumption
d. the opportunity cost of saving in LDCs is lower because of the low levels of income of most of the population
e. the marginal productivity of capital in the LDCs is likely to be lower
C
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If the market in the figure above is a profit-maximizing single-price monopoly, consumer surplus is the area ________
A) ABH B) BFGH C) ACG D) BCD E) ACE
A country that can produce a good using fewer resources than another country has a(n):
a. lower opportunity cost of producing the good than another country. b. absolute advantage. c. specialization in the production of the good. d. all of these.
Refer to the graph shown. From 1938 to 1943 the Federal deficit rose from $1.0 billion to $53.8 billion due to increased defense spending. The effect of this on the AD curve can be shown by a movement from:
A. A to B. B. A to C. C. A to D. D. B to A.
In the given figure, the economy is initially in long-run equilibrium at point A. If there is an adverse supply shock that reduces potential output and shifts the long-run aggregate supply curve from LRAS to LRAS', then there is initially ________ gap and the short-run aggregate supply curve will ________.
A. a recessionary; eventually shift to SRAS" B. a recessionary; eventually shift to SRAS' C. an expansionary; eventually shift to SRAS' D. an expansionary; eventually shift to SRAS"