The real rate of interest is 4% and the anticipated rate of inflation is 2%. What is the nominal rate of interest?
A. 6%
B. 1%
C. 2%
D. 4%
Answer: A
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If the economy is in equilibrium at $1,000 billion national income and if the multiplier is 3 and intended investment is $400 billion, what happens to national income when intended investment decreases to $380 billion? It will
a. increase to $1,020 billion b. increase to $1,060 billion c. decrease to $980 billion d. decrease to $940 billion e. decrease to $970 billion
According to the Coase theorem, private parties can solve the problem of externalities if
a. the cost of bargaining is small. b. the initial distribution of legal rights favors the person being adversely affected by the externality. c. the number of parties involved is sufficiently large. d. All of the above are correct.
Calculate the APS.
About ____ of the world's population subsists on no more than $2 a day.
A. one tenth. B. one quarter. C. one third. D. one half.