Which of the following is not a way in which high inflation reduces productivity?
a. High rates of inflation increase menu costs.
b. Rapid inflation destroys work incentives and encourages speculation.
c. Variable rates of inflation create insecurity.
d. High inflation rates also have the power to deteriorate international competitiveness.
e. High rates of expected inflation increase the real interest rate and thus reduce investment.
.E
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People's abilities to bear risk increases with:
a. their abilities to understand the market. b. their abilities to diversify their asset holdings. c. their abilities to invest in risky assets over a large time period. d. their abilities to judge the probability of outcomes.
If a futures contract for U.S. Treasury bonds increases by "12" in the financial page listings, the value of the contract increased by:
A. $1,200.00. B. $375.00. C. $120.00. D. $240.00.