The difference between the interest rate on a loan and the inflation rate is the
A. expected interest rate.
B. inflation premium.
C. nominal interest rate.
D. real interest rate.
Answer: D
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Which of the following will shift the aggregate demand curve to the right?
A. Income taxes are raised. B. Business managers become pessimistic about the future. C. The government increases spending on education. D. Consumers become pessimistic about the future.
What does it mean to say economics is an empirical science, and how is this related to the question of deciding on the usefulness of a model?
What will be an ideal response?
A corporation's management
A) hires the board of directors. B) is liable for the corporation's debts. C) owns the corporation. D) operates and controls a corporation in its day-to-day activities.
The reporter on one broadcast network says 2011 GDP increased to an all-time high. Commenting on the same figure, a second reporter says GDP in 2011 was less than in 2010 . Which of the following explanations is consistent with the statements of both reporters?
a. The first reporter was referring to real GDP, and the second was referring to nominal GDP. b. The first reporter was referring to nominal GDP, and the second was referring to real GDP. c. The first reporter was referring to GDP as measured by the expenditure approach, and the second was referring to GDP as measured by the income cost approach. d. The first reporter was referring to GDP as measured by the income cost approach, and the second was referring to GDP as measured by the expenditure approach.