Which of the following is true?
a. Monetary policy influences long-term real interest rates more than short-term interest rates.
b. Short-term interest rates are primarily determined by real factors and the expected inflation.
c. A shift to a more expansionary monetary policy will tend to raise short-term interest rates.
d. A shift to expansionary monetary policy that increases the fear of future inflation will tend to increase long-term interest rates.
D
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A company producing sports equipment wishes to increase its total revenue. Should it increase or decrease its price when the product's price elasticity of demand is equal to -0.3?
(a) Increase - the good is price inelastic and in order to increase TR the firm should increase its price. (b) Decrease - the good is price elastic and in order to increase TR the firm should decrease its price. (c) Increase - the good is price elastic and in order to increase TR the firm should increase its price. (d) Decrease - the good is price inelastic and in order to increase TR the firm should decrease its price.