Income elasticity of demand is greater than zero for all of the following except
a. restaurant meals
b. beer
c. owner-occupied housing
d. food
e. rental housing
B
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The idea that the value of money is equal across countries is known as
A) interest rate parity. B) the expected profit parity effect. C) purchasing power parity. D) exchange rate parity.
If, when a firm doubles all its inputs, its average cost of production increases, then production displays
A) economies of scale. B) diminishing returns. C) diseconomies of scale. D) declining fixed costs.
________ sell shares to investors and use the money to buy short-term securities
A) Mortgage-backed securities dealers B) Hedge funds C) Shadow banks D) Money market mutual funds
The twin responsibilities of the Federal Reserve are:
A. to maintain full employment and balance the federal budget. B. to ensure price stability and maintain full employment. C. to ensure price stability and regulate international trade. D. to print money and ensure price stability.