When the real interest rate is less than zero, then:
a. a creditor will gain purchasing power.
b. a creditor will just break even on his or her real loan return.
c. a creditor will lose purchasing power.
d. a creditor will benefit from inflation.
e. a creditor's purchasing power will not be affected, because the nominal interest rate is greater than zero.
c
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Suppose the local market for legal services has an upward sloping supply curve, PL = 150 + 0.0001QL where PL is the price of legal services and QL is the number of hours of legal services
If the equilibrium price of legal services is $250 per hour, what is the aggregate economic rent earned by lawyers in this market? A) $50,000 B) $1,000,000 C) $50,000,000 D) $100,000,000
Constant returns to scale cause the long-run average cost curve to be:
a. horizontal. b. vertical. c. upward-sloping. d. downward-sloping.
Fractional reserve banking is a term used to describe a banking system whereby
A) individual banks share a fraction of the total funds deposited in the whole banking system. B) banks are required to quote interest rates in fractions. C) banks hold reserves equal to only a fraction of their deposit liabilities. D) banks hold reserves equal to a multiple of their deposit liabilities; that is, fractional in this case really means multiple. E) banks are required to maintain a certain fraction of their deposits in the form of checkable deposits, a certain fraction of their deposits in the form of savings deposits, etc.
Which of the following economists did not help to develop game theory analysis?
A) Adam Smith B) John Nash C) John von Neumann D) Oskar Morgenstern