In the short run, a firm will stay in business as long as:
A. price equals average revenue.
B. marginal revenue is greater than or equal to marginal cost.
C. price exceeds average variable cost.
D. price is less than average variable cost.
Answer: C
Economics
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If the nominal interest rate in an economy is 6%, and the rate of inflation in the economy is 4%, the real interest rate in the economy is:
A) 10%. B) 24%. C) 1.5%. D) 2%.
Economics
In the early 1970s monetary growth was relatively stable yet unemployment and prices were quite unstable. This suggests that
A) policy activism is superior to policy rules. B) government spending must have been destabilizing. C) monetary rules will not iron out every short-run fluctuation resulting from shocks. D) the government was following a monetary rule.
Economics