High opportunity costs go hand in hand with high money costs in a properly functioning economy
a. True
b. False
Indicate whether the statement is true or false
True
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Mary is a low-risk applicant for a loan at a bank, while John is a high-risk applicant. If the bank increases the interest rates it charges on loans, _____
a. John is likely to leave the market for loans b. the problem of moral hazard will prevent John from getting a loan c. the commons problem will prevent Mary from getting a loan d. Mary is likely to leave the market for loans e. both Mary and John will leave the market for loans
Say a study reveals that price elasticity of demand for teenage smoking was -0.5. If the government imposed a tax on cigarettes the total expenditure teenagers spend on buying cigarettes would
A. decrease. B. stay the same. C. increase. D. we can't answer with the information given.
Suppose Tracy will get $500 from her parents when she graduates from college two years from today. If the market interest rate is 8 percent, then what is the present value of that $500?
a. $359.12 b. $428.67 c. $462.96 d. $483.11
In the ________, the perfectly competitive firm will react to losses by __________________________.
a. short run; reducing production or shutting down b. long run; reducing production or shutting down c. short run; increasing physical inputs d. long run; increasing capital inputs