Tom buys a futures contract for U.S. Treasury bonds and on the settlement date the interest rate on U.S. Treasury bonds is lower than Tom expected. Tom will have:
A. lost money on his long position.
B. gained money on his long position.
C. gained money on his short position.
D. lost money on his short position.
Answer: B
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The aggregate supply curve shifts rightward when
A) the money wage rate falls. B) government purchases increase. C) potential GDP decreases. D) income taxes increase. E) the money wage rate rises.
Suppose a firm is a price searcher in the product market and hires labor in a perfectly competitive labor market. If the wage rate is $20, the marginal product of the last worker hired is 5, and the firm is hiring the profit-maximizing amount of labor, then the marginal revenue product of the last worker hired must be
a. $1 b. $1.50 c. $4 d. $5 e. $20
Which of the following is true? a. Demand deposits and other checkable deposits have replaced paper and metallic currency as the major source of money used for transactions in the United States. b. Credit cards are not money; they are substitutes for the use of money in exchange
c. Most of the money that we use for day-to-day transactions is not official legal tender. d. all of the above
An externality is
A) a third-party benefit or cost that is associated with the production of a good. B) when external forces such as war or flood affect the market. C) government intervention in the markets. D) transaction costs.