Mary has $1,000 and is considering purchasing a $1,000 bond that pays 7 percent interest per year. Mary decides not to buy the bond and holds the $1,000 as cash
If the inflation rate is 4 percent, the opportunity cost of holding the $1,000 as money is
A) $40.00. B) $30.00. C) $70.00. D) $110.00. E) $100.00.
C
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What did Steckel (1986) find when he compared the slave population to today's white population?
(a) The mortality rates of the slaves were much higher than those of modern whites. (b) Prenatal and postnatal care was the same. (c) The number of pregnancies brought to term in each group was about the same. (d) All of the above.
Consider the production possibilities curve for an economy producing only two commodities wheat (represented on the X axis) and wine (represented on the Y axis). A movement up along the production possibilities curve [PPC] will imply:
a. an increase in wheat production. b. an increase in both wheat and wine production. c. a decline in both wheat and wine production. d. an increase in wine production. e. no change in either wheat or wine production.
The payments you make on your automobile loan are given in terms of dollars. As prices rise you notice you give up fewer goods to make your payments
a. The dollar amount you pay is a nominal value. The number of goods you give up is a real value. b. The dollar amount you pay is a real value. The number of goods you give up is a nominal value. c. Both the dollar amount you pay and the goods you give up are nominal values. d. Both the dollar amount you pay and the goods you give up are real values.
A decrease in the money supply might indicate that the Fed had
a. purchased bonds to increase banks reserves. b. purchased bonds to decrease banks reserves. c. sold bonds to increase banks reserves. d. sold bonds to decrease banks reserves.