The IS curve ________ when the real interest rate increases
A) shifts to the right
B) shifts to the left
C) shifts up
D) all of the above
E) none of the above
E
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When do insurance companies encounter the problem of moral hazard?
a. When simply having insurance causes people to take more risks than they would otherwise. b. When they do not have enough information to distinguish between people who are "good risks" and those who are "bad risks." c. When the price of insurance premiums fully reflects all available information. d. When the insurance company suffers large losses because a major catastrophe has affected a large number of people simultaneously.
A vertical demand curve has an elasticity of demand equal to zero.
Answer the following statement true (T) or false (F)
An increase in the real interest rate will decrease consumption and investment
Indicate whether the statement is true or false
In 2005, Americans spend an average of more than $6,000 per person per year on health maintenance and care
Indicate whether the statement is true or false