The opportunity cost of capital for a consumer's investment decision depends on their financial situation. Which rate should the consumer use?
A) The interest rate on investment opportunities if the consumer is a net saver.
B) The interest rate paid on debts if the consumer is a net debtor.
C) A and B are correct
D) The same interest rate that local firms use to analyze their investment opportunities.
C
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Suppose in the money market the equilibrium nominal interest rate is 5 percent. If the Fed increases the quantity of money, what is the effect on the nominal interest rate?
What will be an ideal response?
In the above table, the marginal product of the 7th worker is 6. What is the total product when 7 workers are employed?
A) 68 B) 70 C) 72 D) 76
Refer to the Article Summary. When Fed Chair Janet Yellen announced that a rate increase would be warranted by the end of the year, she was was referring to the
A) required reserve rate. B) long-term real rate of interest. C) prime rate. D) federal funds rate.
Ceteris paribus, a decrease in the number of firms selling calculators will result in
A. A decrease in the supply of calculators. B. A decrease in the demand for calculators. C. An increase in the supply of calculators. D. An increase in the demand for calculators.