If you have $1,000 in wealth and the price level increases by 20 percent, then
A) the $1,000 will buy fewer goods and services.
B) the $1,000 dollars will buy 20 percent more goods and services.
C) the real value of the $1,000 increases.
D) you will be able to buy fewer goods, but the real value of those goods will increase.
A
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A perfectly competitive firm is operating where its total revenue equals its total cost. In the short run, if market demand increases, this firm will have an economic
a. loss and reduce output b. loss while expanding output c. profit and reduce output d. profit while expanding output e. profit, but will not change output
Answer the following statements true (T) or false (F)
1. Bonds issued by the Federal government are riskier than bonds issued by corporations. 2. The key difference between bonds and stocks is that stocks' income streams are more predictable than those of bonds. 3. Stocks represent a debt, and buyers of stock expect to earn interest. 4. An investment's rate of return is positively related to the price paid for it. 5. Stock investors can earn a return from stocks only in the form of dividends.