If home prices are falling, consumers purchasing a home will find their purchasing power of money has increased. This benefit to consumers is called the:
A. inflation effect.
B. wealth effect.
C. home equity effect.
D. multiplier effect.
Answer: B
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When comparing industries, a monopolistically competitive industry is less competitive than an oligopoly.
Answer the following statement true (T) or false (F)
Which of the following is most likely to be an implicit cost of production?
a. property taxes on a building owned by the firm b. transportation costs paid to a trucking supplier c. rental payments for a building utilized by the company and rented from another party d. interest income foregone on funds invested in the firm by the owners
Foziah is a policy maker who is very concerned about inflation. Should she support a law that will index federal workers’ pay to the inflation rate? Explain why or why not.
What will be an ideal response?
The price of gold is 300 U.S. dollars per ounce in New York and 435 Canadian dollars per ounce in Toronto, Canada. If the law of one price holds for gold, the nominal exchange rate is ________ Canadian dollars per U.S. dollar.
A. 0.333 B. 1 C. 0.690 D. 1.45