As the price level falls
a. people will want to buy more bonds, so the interest rate rises.
b. people will want to buy fewer bonds, so the interest rate falls.
c. people will want to buy more bonds, so the interest rate falls.
d. people will want to buy fewer bonds, so the interest rate rises.
c
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The gravity equation is used to predict:
a. the level of bilateral trade. b. the level of intra-industry trade. c. the weight of exports plus imports. d. the level of inter-industry trade.
As a firm expands output, in the short run marginal costs will
a. always decline as output expands. b. increase at first but eventually level off and decline. c. eventually increase as the firm experiences diminishing returns to the fixed factors of production. d. initially increase at a decreasing rate but eventually increase at an increasing rate.