Suppose we know that 10 Spanish Galleons sunk in the Atlantic ocean carrying approximately 50 tons of gold, but the exact location of these shipwrecks is unknown. Would this gold add to the world reserve?
A) Yes, we know it exists.
B) No, we know it exists but we can't extract the gold.
C) Yes, it's only a matter of time before the shipwrecks are discovered.
D) No, there are no established property rights over the shipwreck so they cannot add to world reserves..
B
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When the inflation rate is positive, the
A) real interest rate is greater than the nominal interest rate. B) real interest rate is less than the nominal interest rate. C) nominal interest rate is zero. D) real interest rate equals the nominal interest rate.
A change in tax rates
A) has a larger multiplier effect the smaller the tax rate. B) has a less complicated effect on GDP than does a tax cut of a fixed amount. C) will not affect disposable income. D) will not affect the size of the multiplier.
Adverse selection exists because ________
A) moral hazard exists B) asymmetric information exists C) of government regulation D) financial innovation continually occurs
Macroeconomics stresses
A. resource allocation and income distribution. B. inflation and unemployment. C. resource allocation and inflation. D. unemployment and income distribution.