Which theory explains all three facts about the term structure?
A) expectations
B) segmented markets
C) preferential treatment
D) liquidity premium
D
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When interest rate rise consumers will
A) compare loan payments with the desirability of goods in the future and increase consumption. B) compare loan payments with the desirability of goods today and increase consumption. C) wait to borrow funds when interest rates fall. D) none of above.
A market that consists of only a few large firms is probably a(n):
A. monopoly. B. perfectly competitive market. C. monopolistically competitive market. D. oligopoly.
Suppose tax policies are changed to encourage saving. Explain how the income effect and substitution effect influence the amount saved
The equilibrium price of a good or service is the price
a. at which the current quantity supplied by producers is equal to the potential output. b. fixed by the government so that producers do not over produce and consumers do not over purchase. c. at which all consumers can afford to purchase units of a good or service as long as they provide them with any value. d. at which the quantity supplied by producers is equal to the quantity demanded by consumers.