Suppose that the United Kingdom pegs the pound to the euro. If all other things remain unchanged, what would you expect to happen to European GDP if all countries who use the euro decided to adopt contractionary fiscal policies?
A) It would rise.
B) It would fall.
C) It would not change.
D) That cannot be determined using the information provided.
Ans: B) It would fall.
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If a number greater than the mean of a series of observations is added to the series, the new mean is:
A) smaller than the original mean. B) greater than the original mean. C) same as the original mean. D) either greater or smaller than the original mean depending on the number of observations in the series.
Oligopolists behave independently of each other.
Answer the following statement true (T) or false (F)
If the market basket of goods and services that the Commerce Department uses to calculate the CPI were to decline from $30,000 in the base year to $15,000 in the current year, the current year's CPI would be
A. 300. B. 150. C. 100. D. 50. E. 0.
Assume we have a stock currently worth $50. We also assume the interest rate is zero, and we can buy options for this stock with a strike price of $50. If the stock can rise or fall by $10 with equal probability over the option period, and the option cannot be exercised until the expiration date, what is the time value of the option?
A. $5 B. $50 C. $40 D. $10