Who has the comparative advantage in the production of good B?
a. Alex
b. Adam
c. Both Alex and Adam
d. Neither Alex nor Adam
Answer: a. Alex
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If a firm wants to borrow $10 million and the real interest rate increases from 5 percent to 6 percent, then the cost of the investment has increased by
A) $6 million per year. B) $100,000 per year. C) $1 million per year. D) $600,000 per year. E) nothing because the real interest rate is the return the firm will earn on its investment.
Monetary policy has a greater impact in an open economy than it does in a closed economy
Indicate whether the statement is true or false
Indifference curves intersect at the point of utility maximization
Indicate whether the statement is true or false
If the MPC = 0.75, MPS must be _______ and the income multiplier is _______
a. 0.25; 4 b. 0.25; 5 c. 0.75; 5 d. 1.50; 5 e. 4; 0.25