The opportunity cost of holding money is:
A. the nominal interest rate.
B. the rate of inflation.
C. the real interest rate.
D. the nominal interest rate less the cost of converting a bond to cash.
Answer: A
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
Subtraction of ________ from Gross National Product yields Gross Domestic Product
A) net factor income B) depreciation C) factor income to the rest of the world D) net government income E) none of the above
The opportunity costs associated with the use of resources owned by a firm are:
a. externalities. b. implicit costs. c. explicit costs. d. sunk costs.
What is the fundamental argument in Malthus' An Essay on the Principle of Population?
A. Ultimately, population growth rate would outpace growth in real GDP leading to declining standards of living. B. Population growth tends to undermine global stability which is a stimulus for future wars and conflicts. C. Population would increase at a geometric rate and the food supply at an arithmetic rate and that this disharmony would lead to forced return to subsistence-level conditions. D. Population growth is the root cause of hunger, poverty, environmental destruction, disease, and social unrest.