The following data summarize the expenditures for the country of XYZ during 2003 in millions of alphabet, the currency of country XYZ. Gross Private Domestic Investment $300 Business Fixed Investment $200 Change in Inventories $100 Exports $200 Imports $200 Personal Consumption Expenditures $800 Government Consumption Expenditures and Gross Investment $500 Statistical Discrepancy $10 Depreciation Expenditures […]
Both ________ and ________ are Federal Reserve assets. A) currency in circulation; reserves B) currency in circulation; securities C) securities; loans to financial institutions D) securities; reserves ANSWER C
Everything else held constant, a decrease in government spending will cause the IS curve to shift to the ________ and aggregate demand will ________. A) right; increase B) right; decrease C) left; increase D) left; decrease ANSWER D
An adverse oil price increase will shift the short-run aggregate supply curve: A) leftward. B) rightward. C) will not shift. D) none of the above. ANSWER A
The yield to maturity for a perpetuity is a useful approximation for the yield to maturity on long-term coupon bonds. It is called the ________ when approximating the yield for a coupon bond. A) current yield B) discount yield C) future yield D) star yield ANSWER A
In the short run, a firm can minimize its total costs of production by operating at the minimum of its average total cost curve. Indicate whether the statement is true or false ANSWER FALSE
Empirical evidence indicates that most firms operate where marginal and average variable costs are constant. Indicate whether the statement is true or false ANSWER TRUE
Which of the following values of the Lerner Index indicates the greatest amount of market power? A) 0.313. B) 0.375. C) 0.6. D) 0.625. ANSWER D
If a perpetuity has a price of $500 and an annual interest payment of $25, the interest rate is A) 2.5 percent. B) 5 percent. C) 7.5 percent. D) 10 percent. ANSWER B
A monetary expansion ________ stock prices due to a decrease in the ________ and an increase in the ________, everything else held constant. A) reduces; future sales price; expected rate of return B) reduces; current dividend; expected rate of return C) increases; required rate of return; future sales price D) increases; required rate of return; […]
