spot exchange typically involve
What will be an ideal response?
some transaction costs
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A new technology is discovered which results in all new cars producing 50 percent less pollution. Which of the following is true?
A) Real GDP increases because the air is cleaner, but nominal GDP does not change since air is free. B) GDP will increase to reflect the fact that the air we breathe is cleaner. C) GDP will increase if there is an increase in the production cost and price of the car. D) GDP increases anytime pollution is reduced. E) GDP will decrease.
By spreading her investments out over many different assets, an investor achieves
A) a higher expected return. B) increased risk. C) diversification. D) greater liquidity.
In Probability of Injury (x-axis) versus Wage (y-axis) space, isoprofit curves slope upward because
A. workers are willing to accept a lower wage in exchange for a riskier work environment. B. profits are constant with respect to risk. C. the firm does not like to pay higher wages. D. profits increase with the number of workers the firm employs. E. in order to keep profits constant, a higher wage must be offset by the firm saving money by not investing as much in preventing on-the-job injuries.
The slope
A) of a straight line is the same regardless of where on the line it is calculated. B) equals the change in the value of the variable measured on the vertical axis divided by the change in the variable measured along the horizontal axis. C) will be small if a large change in the variable measured on the vertical axis is associated with a small change in the variable measured along the horizontal axis. D) Answers A and B are correct. E) Answers A and C are correct.