In an open economy, if domestic citizens decide to save more, then the domestic real interest rate will ________ and the level of capital investment in the country will ________, holding other factors constant.
A. decrease; decrease
B. decrease; increase
C. increase; increase
D. increase; decrease
Answer: B
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A peak is the
A) lower turning point of a business cycle when an expansion ends. B) lower turning point of a business cycle when a recession ends. C) upper turning point of a business cycle when an expansion ends. D) upper turning point of a business cycle when a recession ends.
The section of the marginal cost curve that lies above the average variable cost curve is
A) a perfectly competitive firm's supply curve. B) a perfectly competitive firm's average total cost curve. C) a perfectly competitive firm's total fixed costs curve. D) irrelevant to the firm because it never produces at any point along this curve.
The nominal price of industrial red paint was $12 per gallon in 1993. To convert this value to the real price of paint in 2012 dollars, we should use the:
A) Consumer Price Index. B) Producer Price Index C) Fed funds rate. D) 30-day T-bill rate.
Multiperiod forecasting with multiple predictors
A) is the same as the iterated AR forecast method. B) can use the iterated VAR forecast method. C) will yield superior results when using the multiperiod regression forecast h periods into the future based on p lags of each Yt , rather than the iterated VAR forecast method. D) will always yield superior results using the iterated VAR since it takes all equations into account.