Which of the following would not be classified as capital by economists?
A. Laptop computers at a technology company
B. Sewing machines at a clothing factory
C. A corporate bond from IBM
D. Gym equipment at a local fitness center
Answer: C
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If the nominal rate of interest on a bond was 5 percent, the inflation rate was 3 percent and an individual was in a 25-percent tax bracket, the after-tax real return on the bond would be equal to
a. 2 percent. b. 2.5 percent c. .5 percent.. d. -.5 percent. e. none of the above.
Under a pure price system, the decision of resource allocation is made by
A) the head of the government. B) a queen or king. C) individuals who own the resources. D) no one.
The marginal cost curve of pollution abatement is
A) downward sloping. B) upward sloping. C) horizontal. D) vertical.
If banks cannot lend all of their excess reserves:
a. the money multiplier increases. b. the money multiplier decreases. c. the money multiplier stays the same. d. the amount of loans by the bank increases. e. checkable deposits decrease.