If deflation is 0.5 percent per year and you receive a 1 percent decrease in your salary, then your
A. Real income falls, but your nominal income remains unchanged.
B. Real and nominal income both rise.
C. Real and nominal income both fall.
D. Real income remains unchanged, but your nominal income rises.
Answer: C
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Corporations can attract more lenders by offering a lower coupon on their bonds as compared to the government bonds
a. True b. False Indicate whether the statement is true or false
If the government set a price ceiling of 50 cents for a gallon of gasoline, the most likely consequence would be
A. a surplus of gasoline. B. the demand for automobiles fall. C. shipping costs rise. D. a shortage of gasoline.
Which of the following statements is false?
A) When marginal cost equals average total cost, average total cost is at its highest value. B) The marginal cost curve intersects the average variable cost curve and the average total cost curve at their minimum points. C) The difference between average total cost and average fixed cost is average variable cost. D) Firms often refer to the process of lowering average fixed cost as "spreading the overhead."
The largest expenditure of the U.S. Federal government is for:
A. Education B. National defense C. Pensions and income security D. Interest on public debt