Which of the following is part of an economic model?
A) assumptions
B) norms
C) opinions
D) preferences of economic agents
Answer: A
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The IS curve shows that higher income levels require ________ interest rates to ensure that income equals ________
A) higher, planned autonomous spending B) higher, planned expenditures C) lower, planned autonomous spending D) lower, planned expenditures
A fiduciary monetary standard exists when the value of a currency
A) is determined by law. B) is convertible to a fixed quantity of gold. C) depends upon the public's confidence that the currency can be exchanged for goods and services. D) increases with inflation.
You own stock worth an estimated $1 million in the LPL corporation. In addition, you have personal assets worth another $2 million. LPL becomes insolvent, with debts exceeding assets by $15 million. Your personal wealth will decline by
a. $0 b. $1 million c. $1.5 million d. $3 million e. your proportion of the total outstanding stock shares times $15 million
By how much does the real, bilateral exchange rate change when the nominal, bilateral exchange rate changes from $1.10/€ to $1.00/€, the U.S. tradable basket from $500 to $600 and the Euro-Area tradable basket from €550 to €580?
a. The real exchange rate rises approximately by 18%. b. The real exchange rate falls approximately by 3% c. The real exchange rate rises approximately by 3% d. The real exchange rate falls approximately by 20% e. The real exchange rate falls approximately by 18%