Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose that lenders want to receive a real rate of interest of 5 percent, and that they expect inflation to remain steady at 2 percent

image text in transcribed

Suppose that lenders want to receive a real rate of interest of 5 percent, and that they expect inflation to remain steady at 2 percent in the coming years. Based on this, lenders should charge a nominal interest rate of: a. 2 percent. b. 3 percent. c. 5 percent. d. 7 percent. Which the following is the best measure of improvements in the standard of living of a nation? Growth of: a. national income b. labor productivity c. real GDP d. real GDP per capita Which of the following is the single most important source of U.S. economic growth? A. Stability of the social and political environment b. Increase in the quantity of labor hours c. Increase in labor productivity d. Increase in natural resources Suppose a report from the Bureau of Labor Statistics states that the Consumer Price Index (CPI) for the year 2012 was 160. What is the percentage increase in the prices of goods and services since the base period (Base Period: 1982-84 = 100)? a. 40 percent b. 60 percent c 160 percent d. 260 percent Economic growth is higher in countries that have a. economic freedom. b. wide-spread corruption. c. weak property rights that are not enforced. d. poorly functioning legal systems. A short-cut formula suggests that the per person (per capita) real GDP growth rate equals the growth rate of real GDP minus the population growth rate. Assume the population growth rate is 2 percent and the growth rate of real GDP is 5 percent, then the change in per person real GDP (which represents the change in standard of living) must be: a 2.5 percent b. 3 percent. c 5 percent d. 7 percent

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Integrated Audit Practice Case

Authors: David S. Kerr, Randal J. Elder, Alvin A. Arena

6th Edition

0912503564, 9780912503561

More Books

Students also viewed these Accounting questions

Question

10. Describe the relationship between communication and power.

Answered: 1 week ago