If a bank advertises 3 percent interest for a checking account and the anticipated rate of inflation is 3.5 percent
A. the real rate of interest earned on the account is 3.25 percent.
B. the real rate of interest earned on the account is 0.5 percent.
C. the real rate of interest earned on the account is 6.5 percent.
D. the real rate of interest earned on the account is -0.5 percent.
Answer: D
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Which of the following is the best example of the "traditional process"?
A) commercial bank mergers B) minimum age limits for the purchase of alcoholic beverages C) auctioning U.S. Treasury bills D) colleges and universities give admissions preferences to children of alumni
Harold has always driven cars made by Universal Motors. The last two Universal Motors cars that Harold purchased have had major engine problems resulting in Harold incurring significant cost. Consumer Reports has consistently given Universal Motors poor
ratings. Still, Harold plans to purchase another Universal Motors car next fall. Harold's behavior is an example of which systematic mistake that people make?
Based on Figure 6.1, given a tariff of $0.25 per bushel on soybean imports, how much will domestic production increase?
A) Domestic firms will increase output by 10 million bushels. B) Domestic firms will increase output by 20 million bushels. C) Domestic firms will increase output by 70 million bushels. D) Domestic firms' production will not be changed by the tariff.
The largest spending category for state governments is
A) welfare. B) health care. C) education. D) highway construction.