The "expected real" interest rate is the
A) rate actually quoted in financial markets.
B) rate actually quoted in financial markets minus the expected inflation rate.
C) rate actually quoted in financial markets plus the expected inflation rate.
D) rate actually quoted in financial markets divided by the expected inflation rate.
B
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Which of the following is a reason why a firm would not engage in price discrimination?
A) The transactions costs associated with selling the product exceed the price of the product. B) Some firms do not want to violate the law of one price. C) Some firms are not able to segment the market for the products they sell. D) Price discrimination is illegal in some western states and the owners of firms in these states face civil or criminal prosecution if they engage in price discrimination.
According to the survivor principle
A) firms will get taken over by their larger rivals over time. B) only firms that maximize profits survive in highly competitive markets. C) managers only work hard if they are threatened with their survival at the firm. D) eventually all firms merge to become one large monopoly.