According to Figure 15.5, the liquidity trap occurs at an interest rate of
A. 8 percent only.
B. 2 percent, 4 percent, 6 percent, and 8 percent.
C. 2 percent and 4 percent.
D. 2 percent only.
Answer: D
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A college requesting applicants to submit their high school transcripts is an example of:
A. signaling. B. screening. C. statistical discrimination. D. building a reputation.
Recall the Application about the role of megacities in economic growth to answer the following question(s).According to the Application, which country has more cities with a population greater than 5 million?
A. South Korea B. The United States C. China D. Japan
Assuming the free flow of capital across borders, if country A wants to fix its exchange rate with country B, then:
A. country A's monetary policy will not be able to be used to address domestic issues. B. country A's monetary policy must be conducted so the inflation rate in country A matches the inflation rate in country B. C. country A's inflation rate will have to match country B's. D. all of the answers given are correct.
Which of the following would result in a higher absolute value of the price elasticity of demand for a product?
A) A wide variety of substitutes are available for the good. B) The time period under consideration is short. C) The good is a necessity. D) The expenditure on the good is small relative to one's budget.