If an economy experiences increasing opportunity costs with respect to two goods, then the production possibilities curve between the two goods will be
A. Bowed outward until the two goods are equal, and then bowed inward.
B. Bowed outward or concave from below.
C. Bowed inward or convex from below.
D. A straight, downward-sloping line.
Answer: B
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If Fredonia has a closed economy, it ________ with other countries.
A. does not negotiate B. trades C. does not trade D. prevents it's citizens from traveling to other countries but trades
Monopoly is characterized by
A. a horizontal demand curve. B. many close substitutes. C. no barriers to entry. D. a downward sloping demand curve.
The required stock return an investor seeks can best be represented by which of the following?
A. Risk-free Return + Risk Premium B. Risk Premium - Risk-free Return C. Risk-free Return × Risk Premium D. (Risk-free Return + Risk Premium)/(1 + i)
The nominal interest rate is 7% and the real interest rate is 2.75%. What is the inflation rate?
A) 3.75% B) 4.55% C) 4.25% D) 9.75%