Last year, the nominal interest rate was less than the anticipated rate of inflation
A) This means that not enough loans were made by banks.
B) This means that the real interest rate was negative.
C) This means that the real interest rate was very high.
D) This scenario is not possible.
B
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An advantage of a negative income tax is _____
a. it is more paternalistic than in-kind transfer payments b. it could replace many existing transfer programs c. it eliminates the incentive to substitute into leisure d. it has no excess burden
Refer to the above table. If opportunity costs are constant and the two countries trade
A) the United States should specialize in computers and Mexico in bicycles. B) the United States should specialize in bicycles and Mexico in computers. C) the United States should specialize in both bicycles and computers, and Mexico should specialize in neither. D) there will be no trade because they are so different.