The variance of a portfolio of assets:
A. approaches 1 as the number of assets increases.
B. approaches 0 as the number of assets decreases.
C. decreases as the number of assets increases.
D. increases as the number of assets increase.
Answer: C
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Which of the following increases the quantity supplied of good X but does NOT increase the supply of good X?
A) a fall in the price of a factor production used to produce X B) an advance in the technology for producing X C) an increase in the price of good Y, a complement in the production of X D) an increase in the price of X
Explain what market signaling is?
What will be an ideal response?
The fact that a firm is using a capital-intensive method of production means that input substitution is not possible
Indicate whether the statement is true or false
Suppose the economy was in equilibrium, and the national government increased spending by $200 billion. Monetarist theory would predict that the main factor that will readjust the economy is the:
a. Price level. b. Real GDP. c. Nominal and real exchange rates. d. Real risk-free interest rate. e. Money supply.