Which of the following is true of a beneficial supply shock?
a. It can lead to a temporary lower price level
b. It can create a recessionary gap.
c. It can permanently decrease the economy's price level.
d. It can shift the aggregate demand curve rightward.
e. It can shift the aggregate demand curve leftward.
a
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Beta in the CAPM is ____
a. one measure of the systematic risk of a stock b. estimated as the slope of a regression line between an individual security's returns and returns for the market index. c. useful in estimating the firm's cost of debt capital d. a and b only e. a, b, and c
Suppose that Fernando allocates his lunch money to pizza and Coke. A Coke costs $1 and a slice of pizza costs $1.50 . The marginal utility of the last slice of pizza Fernando ate today was 30, and the marginal utility of his last Coke was 25 . Fernando spent all of his lunch money. From this information, we can conclude that:
a. Fernando allocated his money in a way that maximized his total utility. b. Fernando's total utility would have been higher if he had purchased more Coke and less pizza. c. Fernando's total utility would have been higher if he had purchased more pizza and less Coke. d. Fernando could have increased his total utility by purchasing more Coke but the same quantity of pizza. e. Fernando could have increased his total utility by purchasing more pizza but the same quantity of Coke.
Which of the following is true of the structure of the public education system in the United States?
A. Teachers are paid based solely on their performance and abilities. B. School principals do not have budgetary incentives to make bad teachers better. C. Parents can threaten principals to move their kids to a private school if they are disappointed with the quality of education. D. Teachers receive monetary incentives to educate students with special needs.
During the expansion phase of the business cycle, business firms become optimistic about their future earning capacity as do banks. Nominal interest rates rise during expansions. Investment lending could be expected to
A) rise if the change in future earnings is thought to be greater than the change in interest rates. B) stay the same. C) fall. D) fall if the change in future earnings is thought to be greater than the change in interest rates.