Four banks are offering the same interest rate of 4%. Where do you invest?
A) Bank A compounds interest on a yearly basis.
B) Bank B compounds interest on a monthly basis.
C) Bank C compounds interest on a daily basis.
D) I am indifferent between banks.
C
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The argument that when policy changes, people's behavior changes so that historical relationships between macroeconomic variables will no longer hold is known as
A) the Phillips curve. B) the policy irrelevance hypothesis. C) hysteresis. D) the Lucas critique.
When a firm increased its output by one unit, its AFC decreased. This is an indication that
A) the law of diminishing returns has taken effect. B) MC < AFC. C) AVC < AFC. D) the firm is spreading out its total fixed cost.
When someone does not have to pay for a good it:
A. means there is zero demand for the good. B. is rational to overconsume. C. is rational to underconsume. D. is irrational to overconsume.
Money as a means of payment refers to:
A. only coins and currency. B. only actual currency. C. only coins, currency and credit cards. D. anything that is generally accepted as payment for goods and services.