If autonomous consumption is equal to $80, then when income is zero, saving is
a. $0
b. –$20
c. –$80
d. $20
e. $80
C
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A) increase in net exports. B) decrease in investment spending. C) decrease in oil prices. D) increase in consumption spending.
The concept of adverse selection helps to explain
A) why collateral is not a common feature of many debt contracts. B) why large, well-established corporations find it so difficult to borrow funds in securities markets. C) why financial markets are among the most heavily regulated sectors of the economy. D) why stocks are the most important source of external financing for businesses.
Ceteris paribus, bond price and bond yields are
A) inversely related. B) positively related. C) not related. D) associated but not correlated.
Workers who lose their jobs because of a recession are experiencing
What will be an ideal response?