Hector's wealth is zero, he expects to work for another 45 years at a constant salary of $80,000 and live for another 60 years
Assuming taxes are zero, if Hector receives an unexpected $20,000 increase in salary his first year of work and he completely smooths consumption over his lifetime, his annual consumption is A) $67,500
B) $75,000.
C) $80,000.
D) $111,111.
B
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Use the following graph for a private closed economy (an economy with only a private sector and no international trade) to answer the next question.
The equilibrium level of real GDP in this economy is
A. $250 billion. B. $350 billion. C. $450 billion. D. $150 billion.
Which of the following describes the accuracy of the Consumer Price Index?
A) Changes in the CPI overstate the true rate of inflation. B) Changes in the CPI understate the true rate of inflation. C) Changes in the CPI are unrelated to the true rate of inflation. D) Changes in the CPI accurately reflect the true rate of inflation.
What does LIBOR stand for?
A) London Interbank Offer Rate B) Least Integral Borrowing Order Rate C) Local Interest Bank Ongoing Rate D) Liberalized Interoffer Borrowing Rate
Regulation of the banking industry in the 1980s contributed to the demise of many savings and loans
Indicate whether the statement is true or false