Which of the following statements is correct?
a. Interest would not exist in a nonmonetary economy.
b. The present value of a future dollar payment is inversely related to both the interest rate and to how far in the future the payment will be received.
c. A "positive rate of time preference" means that an individual would rather save than consume.
d. During an extended inflationary period, the money (or nominal) interest rate will usually be lower than the real rate of interest.
B
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A monopoly is a
a. price taker b. single buyer of an input into production c. firm facing a perfectly elastic demand curve d. group of firms controlling the price and output for an industry e. price setter
A decrease in the price of ice cream is likely to cause:
A. an increase in the demand for ice cream cones due to a change in the price of a complementary good. B. an increase in the demand for ice cream cones due to a change in the preferences of consumers. C. an increase in the demand for ice cream cones due to a change in the price of a substitute good. D. a decrease in the demand for ice cream cones due to a change in the price of a related good.