If the actual inflation rate is less than the expected inflation rate, the actual real interest rate will be ________ than the expected real interest rate. When this happens, ________ will lose and ________ will gain
A) less; borrowers; lenders
B) less; lenders; borrowers
C) greater; borrowers; lenders
D) greater; lenders; borrowers
C
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Answer the following statement(s) true (T) or false (F)
1. A Paasche price index makes price changes seem better for the consumer than they really are. 2. A Laspeyres price index is based on the basket consumed in the later period.. 3. If the consumer has the same tax bill under a head tax as under an income tax, then the consumer will be indifferent between the two taxes. 4. If the consumer has the same tax bill under a head tax as under an income tax, then less leisure will be consumed under the head tax than under the income tax. 5. The cardinal utility approach has exactly the same implications as the indifference curve approach.
In a system of flexible exchange rates, expansionary monetary policy abroad would induce
a. a rise in the U.S. exchange rate. b. a fall in the U.S. rate of exchange. c. a balance of payments surplus for the United States. d. no change in U.S. exchange rates.
The Taft-Hartley Act outlawed all of the following practices EXCEPT
A) secondary boycotts. B) union shops. C) closed shops. D) sympathy strikes.
Which of the following is true about increasing cost industries? a. They use a large portion of available specialized input resources in production
b. In order for industry output to expand, the prices of the specialized inputs will increase. c. Expansion of industry output leads to a higher equilibrium price in the long run. d. All of the above are generally true of increasing cost industries.