Julio borrows $250 from Ricky. Ricky wants to make a 5% real return on his money, so they both agree on a 5% interest rate paid next year. Both don't anticipate the 5% inflation next year. In this case
A. Julio will pay $15 a year from now on.
B. Julio is better off.
C. Ricky will receive more than 5% of real rate of return a year from now.
D. Ricky is better off.
Answer: B
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A headline states: "Real GDP falls again as the economy slumps." This condition is most likely to produce what type of unemployment?
A. natural B. frictional C. structural D. cyclical
A decrease in government spending will cause a(n) ________.
A. decrease in aggregate demand B. increase in aggregate demand C. decrease in the quantity of real output demanded D. increase in the quantity of real output demanded
Exhibit 11-8 Aggregate demand and supply curves
In Exhibit 11-8, supply-siders claimed that the shift from AS1 to AS2 would occur if the government:
A. increased tax rates and increased the amount of government regulation. B. increased tax rates and decreased the amount of government regulation. C. decreased tax rates and increased the amount of government regulation. D. decreased tax rates and decreased the amount of government regulation.
Which of the following countries has adopted the U.S. dollar as its own currency?
A) Ecuador B) Mexico C) Canada D) France E) Australia