If the cost of capital decreased to 1%, does the firm invest in the new technology?
a. Yes because the NPV>0
b. Yes because the NPV=0
c. Need information on the marginal benefits and costs
d. No because the NPV<0
a
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The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
In the above figure, 300,000 purses per month is
A) the efficient amount to produce because at 300,000 purses marginal social benefit equals marginal social cost. B) the efficient amount to produce because at 300,000 purses marginal social benefit is greater than marginal social cost. C) an inefficient amount to produce because at 300,000 purses marginal social benefit equals marginal social cost. D) an inefficient amount to produce because producing 500,000 purses sets the marginal social benefit equal to zero.
If a 10 percent rise in price leads to a reduction in quantity demanded of more than 10 percent,
a. demand is elastic. b. demand is inelastic. c. elasticity of demand is unitary. d. None of the above is correct.
Which of the following statements is false?
A) As the price paid for a bond rises, the yield declines. B) If you purchase stock from an individual that currently owns the stock, you are buying it in the secondary market. C) The yield on a bond is another term for the coupon rate on a bond. D) A rating of Aaa from Moody's is the highest bond rating given by that rating agency.