Appendix: Incentive-compatible revelation mechanisms attempt to
a. induce an employee to reject the next best alternative employment opportunity
b. elicit privately-held information
c. secure enforcement primarily by third parties
d. reject voluntary contracting with third parties
e. impose similar risk premiums on all employees
b
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The quantity theory of money assumes that the velocity of money
In a closed economy:
A) consumption is equal to zero. B) investment is equal to zero. C) government spending is equal to zero. D) net exports is equal to zero. In a closed economy, without the government, the consumption expenditure equals $5,000 and the investment expenditure equals $2,000.
You bought some shares of stock and sell them one year later. At the end of the year, the price per share was 5 percent higher and the price level was 3 percent higher. Before taxes, you experienced
a. both a nominal gain and a real gain, and you paid taxes on the nominal gain. b. both a nominal gain and a real gain, and you paid taxes only on the real gain. c. a nominal gain and a real loss, and you paid taxes on the nominal gain. d. a nominal gain and a real loss, and you paid no taxes on the transaction.
In the open-economy macroeconomic model, if a country's interest rate rises, its net capital outflow
a. rises and the real exchange rate rises. b. falls and the real exchange rate falls. c. rises and the real exchange rate falls. d. falls and the real exchange rate rises.