You buy a bond for $1,000 from the federal government, which guarantees that you will receive $70 a year forever. Thus, 7 percent was the market rate of interest when you bought the bond. Suppose that immediately after you buy the bond, the market rate of interest goes to 10 percent. The market value of your bond
a. could be more or less than $1,000
b. will be less than $1,000
c. will be more than $1,000
d. will remain unchanged
e. will be $1,000
B
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When an economy's resources are not fully employed, then it must be true that the:
A. production point is located outside and to the right of the production possibilities curve. B. production point is located along the production possibilities curve. C. production point is located inside and to the left of the production possibilities curve. D. production possibilities curve shifts to the left.
Suppose there is a reduction in foreign output (Y*). This reduction in Y* will cause which of the following in the domestic country?
A) a reduction in output B) a reduction in consumption C) a reduction in net exports D) all of the above E) none of the above
Some states require that unions represent non-union workers who don't pay dues in their collective bargaining negotiations
Explain using economic logic how this might result in fewer unions than would otherwise be the case if these types of laws did not exist.
A new cure for Toenail fungus is discovered for individuals resistant to the original treatment. At this point the firm producing this drug
a. Could be considered a monopoly b. Would be protected from entry by patents c. Would be facing many new entries in the market d. Only A&B