The value of a price index in the base year will always be zero

Firefighters are highly skilled workers who are typically employed by city governments. If a city reduces the wage rate paid to firefighters to be less than the equilibrium wage rate, what happens to the economic rents earned by the firefighters?

A) Increase B) Decrease C) Remain unchanged D) Public employees like firefighters cannot earn economic rents

Suppose the interest rate on a bond is 12.5 percent and that bond pays $90 a year in interest and sells for $720 . If the supply of bonds increases and the price of the bond falls to $600, the interest rate will ____ to ____

a. increase; 15 percent b. increase; 17.5 percent c. decrease; 7.5 percent d. decrease; 10 percent e. increase; 13 percent