The following table shows Alex's estimated annual benefits of holding different amounts of money.Average money holdingsTotal benefit$700$50$800$59$900$66$1,000$71$1,100$74 How much money will Alex hold if the nominal interest rate is 6 percent? (Assume she wants her money holdings to be in multiples of $100.)
A. $700
B. $1,000
C. $800
D. $900
Answer: D
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Generating electricity creates air pollution. This industry, if left unregulated, will produce at an inefficient market equilibrium where
A) marginal private cost equals marginal social benefit. B) marginal social cost equals marginal social benefit. C) marginal social cost equals marginal private cost. D) marginal social benefit is greater than marginal social cost.
The adverse selection problem in international investment means
A) that those seeking funds for the riskiest projects are those most actively seeking the funds. B) that the recipients of the funds may use the funds for other than the approved projects. C) that government officials may demand higher than the usual amount of bribes. D) those in the highest levels of government are the most dishonest.
When an externality is present in a market, and correcting it increases the efficiency of the market, we can conclude it is a:
A. negative externality. B. positive externality. C. network externality. D. either a negative or a positive externality.
most frequently used monetary policy tool is
What will be an ideal response?