The real interest rate is 4 percent and the nominal interest rate is 6 percent. Is there inflation or deflation? What is the inflation or deflation rate?
a. deflation; 2 percent
b. deflation; 10 percent
c. inflation; 2 percent
d. inflation; 10 percent
c
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Moving along the total product curve, which of the following is held constant?
A) quantity of labor B) total product C) technology D) total cost E) None of the above answers is correct.
If a firm refuses to hire any minorities due to a personal prejudice, its profits
a. will increase markedly. b. will decrease. c. will not be affected. d. will increase slightly.
Tommy's Teddy Bears incurs $300,000 per year in explicit costs and $50,000 in implicit costs. The shop earns $600,000 in revenues and has $1.1 million in net worth. Based on this information, what is accounting profit for Tommy's Teddy Bears?
A) $250,000 B) $300,000 C) $500,000 D) $1.35 million
Indicate how changes in monetary policy are transmitted to the goods and services market? Discuss for the case of an expansion in the money supply