When there is positive inflation
A) the nominal interest rate is approximately equal to the real interest rate.
B) the real interest rate is greater than the nominal interest rate.
C) the nominal interest rate is greater than the real interest rate.
D) the real interest rate is negative.
C
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Accountants calculate __________ differently than do economists: a. Total revenue
b. Total costs. c. Profits. d. Both total costs and profits.
A firm that is a natural monopoly
a. is not likely to be concerned about new entrants eroding its monopoly power. b. is taking advantage of diseconomies of scale. c. would experience a lower average total cost if more firms entered the market. d. All of the above are correct.
The efficient market hypothesis suggests that:
A. asset price bubbles are efficient. B. irrationality must a part of every economic model. C. while individuals can be irrational, collectively they will not. D. because individuals are rational, collectively they are also rational.
Our balance on current account
A. has recently turned negative. B. has been negative for years. C. has recently turned positive. D. has been positive for years.