If you expect interest rates to rise, you will want to be holding:
A. more money because bond prices will likely rise.
B. less money because bond prices will likely fall.
C. more money because bond prices will likely fall.
D. less money because bond prices will likely rise.
Answer: C
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"When countries specialize in producing the good in which they have a comparative advantage and then trade with each other, only the country with the absolute advantage gains
" Is the previous statement correct or incorrect? Briefly explain your answer.
The result of the reunification of eastern and western Germany in 1990
A) was a boom in Germany and higher inflation, with no effect on nearby countries. B) was a recession in Germany and lower inflation, with no effect on nearby countries. C) was a boom in Germany and higher inflation, and, with other EMS countries' commitment to fixed exchange rates, a deep recession in nearby countries. D) was a recession in Germany and lower inflation, and, with other EMS countries' commitment to fixed exchange rates, a deep recession in nearby countries. E) was a recession in Germany and lower inflation, causing a boom in nearby countries.
An argument in support of hysteresis is
A) companies may be reluctant to hire workers until AD increases. B) prices are sticky in the short run. C) the skills of unemployed workers may deteriorate making it more difficult to find a job. D) overlapping wage contracts.
Although a balanced budget may be appropriate under one monetary policy, a deficit or surplus may be appropriate under a different monetary policy
a. True b. False Indicate whether the statement is true or false