Refer to the data provided in Table 11.4 below to answer the following question(s).
Table 11.4 
Refer to Table 11.4. If the interest rate is 22%, then the farmer will only
A. buy the bookkeeping software and the grain storage tanks.
B. buy the tractor.
C. buy the tractor and the irrigation system.
D. buy the bookkeeping software.
Answer: C
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Governments are often forced to bail out large banks to prevent the entire economy from being affected adversely. This provision often encourages banks to invest in risky assets. This is an example of ________
A) moral hazard B) a positive externality C) adverse selection D) anchoring
Which of the following assumptions is found in Friedman's model but not in the new classical model?
A) Supply of labor depends on expected real wage. B) Workers gradually adapt their expectations of the price level to the actual price level. C) imperfect information D) market-clearing labor market
Refer to the table shown. In trillions of dollarsConsumption3.5Investment1.2Government Purchases1.8Exports0.6Imports0.4What are the economy's net exports?
A. ?$0.4 trillion B. $1.0 trillion C. $0.2 trillion D. ?$0.2 trillion
Exhibit 20-5 Money, investment and product markets
?
In Exhibit 20-5, if the interest rate falls from i1 to i2, investment spending will:
A. increase, and aggregate demand will shift from AD1 to AD2. B. decrease, and aggregate demand will shift from AD2 to AD1. C. remain the same, and aggregate demand will shift from AD2 to AD3. D. increase, and aggregate demand will shift from AD2 to AD1.