If people assume that future rates of inflation will follow the pattern of inflation rates in the past, they are said to have
A) rational expectations. B) accommodative expectations.
C) unstable expectations. D) adaptive expectations.
D
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Laws and courts tend to make markets work ________ and make society ________
A) less effectively; poorer B) less effectively; richer C) more effectively; poorer D) more effectively; richer
Junk bonds, bonds with a low bond rating, are also known as
A) high-yield bonds. B) investment grade bonds. C) high quality bonds. D) zero-coupon bonds.
A "devaluation" occurs when
A) the official price of a currency is raised. B) the official price of a currency is lowered. C) a nation's currency depreciates under a flexible exchange rate system. D) a nation's currency appreciates under a flexible exchange rate system. E) none of the above
A lump-sum tariff imposed on foreign competitors will:
A. decrease the profits of domestic firms when demand is high. B. have no impact on domestic firms' profits when demand for domestic goods is high. C. increase the profits of domestic firms when demand is high. D. always remove foreign competitors from the market.