Assume the current interest rate is 25%. The present value of $1,000 in one year would be
A. $180.
B. $450.
C. $750.
D. $800.
Answer: D
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Following a new deposit of $50 at a bank, drawn on funds previously held on deposit at another bank, when the reserve ratio is 10 percent, the maximum potential increase in the money supply will be
A) $0. B) $50. C) $400. D) $500.
Amy can produce either 5,000 pounds of cheese or 20 cars per year. Mike can produce either 5,000 pounds of cheese or 10 cars per year. If both Amy and Mike produce the good in which they have comparative advantage, the total annual output of this economy will be ________.
A. 30 cars B. 10,000 pounds of cheese and 30 cars C. 5,000 pounds of cheese and 20 cars D. 10,000 pounds of cheese
Which of the following are included in interest income? i. payments made for the use of land ii. income paid to households for loans they make iii. payments made by households for their borrowing
A) i, ii and iii B) ii and iii only C) i and ii only D) ii only E) iii only
When you purchase school supplies at the book store using cash, you are using money as a medium of exchange
a. True b. False Indicate whether the statement is true or false