An individual who is risk-averse:
A. requires larger compensation when the risk increases.
B. never takes risks.
C. accepts risk but only when the expected return is very small.
D. will accept a lower return as risk rises.
Answer: A
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Suppose the U.S. dollar price of the Euro falls. This means that
A) the U.S. exchange rate has risen and the U.S. dollar buys more euros. B) the U.S. exchange rate has risen and the U.S. dollar buys less euros C) the U.S. exchange rate has fallen and the U.S. dollar buys more euros. D) the U.S. exchange rate has fallen and the U.S. dollar buys less euros.
To say that inflation is a monetary phenomenon seems to beg the question
A) Why does inflationary monetary policy occur? B) Why do politicians seek reelection? C) Why is the Fed independent? D) Why does the U.S. Treasury print so much money?