The yield curve is the relationship between the:
a. Real interest rate and expected inflation rate.
b. Domestic yield and foreign yield.
c. Real yield (i.e., interest rate) and actual inflation.
d. Nominal yield and time to maturity of a security.
e. Nominal yield on corporate securities and the yield of government securities.
.D
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Many middle-to-older-aged men now claim they "need" Viagra (the male impotency wonder drug) for an enjoyable sex life. The economic way of thinking predicts
A) more men would be likely to claim they need Viagra if the price per pill were much lower (say two cents each) compared to the current price. B) fewer men would be likely to claim they need Viagra if the price per pill were much higher (say, two hundred dollars each) compared to the current price. C) other things constant, more prescriptions would be written if the price of Viagra falls significantly. D) other things constant, fewer prescriptions would be written if the price of Viagra rises significantly. E) all of the above are true.
A department store buys a wool coat for $120 and sets its retail price at $300 . The coat costs $85 to produce. When the coat doesn't sell, the store marks the price down to $200, then $100, and finally $70 . At $70, Amy buys the coat. What was the coat's true value? Why?