If the nominal interest rate is 2.9 percent and the rate of inflation is 0.6 percent in a given year, then what is the corresponding real rate of return?
A) 3.5 percent
B) 2.3 percent
C) -3.5 percent
D) None of the above.
B
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The effect of a drop in business confidence on the evaluation of MPK shifts the IS curve to the ________. Suppose the LM curve is fixed
The resulting ________ in the interest rate works through the accelerator model to ________ the fall in equilibrium output. A) left, rise, increase B) left, rise, more than offset C) left, fall, offset part of D) right, rise, offset part of E) right, fall, more than offset
In 1981, in San Francisco Solano, Argentina, about 1,800 families took over a piece of wasteland. The government was able to deed 60 percent of this land to some families while the remaining part could not be deeded. The resulting houses varied greatly, based on whether the residents received title. Those who received title also behaved differently, having fewer children, and the children
experienced more education and better health. This is an example of the results from: a. scarcity. b. economic growth. c. economic freedom. d. private property rights. e. improved quality of life.
In a circular flow diagram of the economy, households and businesses interact
a. in both product markets and resource markets b. in neither product markets and resource markets c. in product markets but not resource markets d. in resource markets but not product markets e. very rarely
Real business cycle theory suggests that changes in
A. technology and resources affect productivity, and thus the long-run growth of aggregate supply. B. monetary policy is the single most important cause of macroeconomic instability. C. the velocity of money is gradual and predictable and thus able to accommodate the long-run changes in nominal GDP. D. investment spending will have a direct and significant effect on aggregate demand.