The classical dichotomy is the separation of real and nominal variables. The following questions test your understanding of this distinction. Rina spends all of her money on comic books and beignets. In 2011 she earned $14.00 per hour, the price of a comic book was $7.00, and the price of a beignet was $2.00.
Which of the following give the nominal value of a variable? Check all that apply.
__ Rina's wage is 2 comic books per hour in 2011.
__The price of a beignet is $2.00 in 2011.
__ Rina's wage is $14.00 per hour in 2011.
Which of the following give the real value of a variable? Check all that apply.
__Rina's wage is $14.00 per hour in 2011.
__The price of a comic book is 3.5 beignets in 2011.
__Rina's wage is 7 beignets per hour in 2011.
Suppose that the Fed sharply increases the money supply between 2011 and 2016. In 2016, Rina's wage has risen to $28.00 per hour. The price of a comic book is $14.00 and the price of a beignet is $4.00.
In 2016, the relative price of a comic book is ( 0.29 beignets, 3.5 beignets, $4.00, $14.00)
Between 2011 and 2016, the nominal value of Rina's wage (decreases, increases, remains the same) and the real value of her wage(decreases,increases,remains the same) .
Monetary neutrality is the proposition that a change in the money supply (does not affect, affect) nominal variables and ( does not affect, affect) real variables.
Answers
Answer:
Real variable
__ Rina's wage is 2 comic books per hour in 2011.
Nominal variable
__The price of a beignet is $2.00 in 2011.
__ Rina's wage is $14.00 per hour in 2011.
Relative price of comic books - 3.5 beignets
Nominal value of Rina's wage increases
Real value of Rina's wage stages the same.
Monetary neutrality is the proposition that a change in the money supply ( affect) nominal variables and ( does not affect, ) real variables.
Explanation:
Nominal value is the face value or stated value.
Real value is nominal value adjusted for inflation. Real value of money also refers to the amount of goods and services money can buy.
Relative price is the price of a good in relation to another good.
The relative price of comic books in 2016 to biegnets = $14 / $4 = 3.5
Rina's income increased from $14 in 2011 to $28 in 2016. Her nominal income increased.
But the purchasing power of her income fell. In 2011 , her income could buy :
$14 / $7 = 2 comic books
Or
14 / 2 = 7 beignets
But in 2016, her income would buy:
$28 / $14 = $l2
Or
$28 / $4 = 7
We can see that her purchasing power remains the same.
I hope my answer helps you
Related Questions
Briana was employed as a flight attendant by Tropical Coast Airlines. She was the only black female flight attendant on the airplane she was assigned to. At her job, Briana was frequently subjected to racial slurs, misbehavior, and threats from her co-workers. One co-worker even told their supervisor that the airline’s customers would not want to take orders from a black girl in the case of an in-flight emergency. Unable to tolerate the hostile environment, Briana quit her job. Which of the following holds true in this scenario? A) Briana has a cause of action for racial harassment under 42 U.S.C. section 1983. B) Briana does not have a cause of action for racial harassment, as she resigned at her own will. C) Briana has a cause of action for racial harassment under Title VII of the Civil Rights Act of 1964, as there is evidence that she was harassed. D) Briana does not have a cause of action for racial harassment, as the actions of her co-workers were not pervasive or severe.
Suppose Juanita currently allocates 75% of her portfolio to a diversified group of stocks and 25% of her portfolio to risk-free bonds; that is, she chooses combination D. She wants to reduce the level of risk associated with her portfolio from a standard deviation of 15 to a standard deviation of 5. In order to do so, she must do which of the following? Check all that apply.a. Sell some of her stocks and use the proceeds to purchase bondsb. Accept a lower average annual rate of returnc. Sell some of her bonds and use the proceeds to purchase stocksd.Place the entirety of her portfolio in bonds
Present value with periodic rates. Sam Hinds, a local dentist, is going to remodel the dental reception area and add two new workstations. He has contacted A-Dec, and the new equipment and cabinetry will cost $25 comma 000. The purchase will be financed with an interest rate of 10% loan over 6 years. What will Sam have to pay for this equipment if the loan calls for semiannual payments (2 per year) and monthly payments (12 per year)? Compare the annual cash outflows of the two payments. Why does the monthly payment plan have less total cash outflow each year? What will Sam have to pay for this equipment if the loan calls for semiannual payments (2 per year)?
Rates on fixed, floating, installment and mortgage loans were reduced by 0.3 percent (from 9.3% to 9.0% etc.). Which were impacted the most
Answers
Answer:
D. total assets to common stockholders' equity
Explanation:
The financial leverage multiplier (FLM) is defined as the ratio of the firm’s total assets to the shareholders’ equity.
Analyzing the answer choices provided, the one that better fits the description above is alternative D. total assets to common stockholders' equity
Answers
Answer:
Option E (143) is the appropriate solution.
Explanation:
According to the question,
The modified duration will be:
=
=
=
The percentage change in price will be:
=
= (%)
Now,
The EMOD will be:
=
= ($)
Or,
The EMAC will be:
=
= ($)
Hence,
⇒
⇒
Answers
Answer:
z = 0.96, standard deviations to the right of the mean 170 cm
Explanation:
z=
x = 176 cm is 0.96, standard deviations to the right of the mean 170 cm
Answers
Answer:
7.6%
Explanation:
The formula for calculating the Required return is:
Required return = Dividend yield + Capital Gain Yield
Hence,
13% = Dividend Yield + 5.40%
Dividend Yield = 7.60%.
Hope this helps.
Goodluck.
A. The firm that sets the lowest price gains the entire market share.
B. A single firm sets a price which is lower than the current market price and gains market share at the expense of the other firms.
C. A single firm sets the price in the market, which is taken as given by the other smaller firms.
D. Each firm in the market sets its price based on the reaction of the other firm.
E. The firms in the market collude and set prices in order to maximize their combined profits.
Answers
Answer:
C. A single firm sets the price in the market, which is taken as given by the other smaller firms
Explanation:
An oligopoly is when there are a few large firms operating in an industry. There are significant barriers to entry or exit of firms in the industry.
An oligopoly can set price through price leadership. It is when a firm sets the price in the market, which is taken as given by the other smaller firms.
Another way an oligopoly sets prices is through collusion. It is when firms in an oligopoly come together to set prices.
I hope my answer helps you.
b. The mayor would be correct if demand were price inelastic; the city manager would be correct if demand were price elastic.
c. Both the mayor and city manager would be correct if demand were price elastic.
d. Both the mayor and city manager would be correct if demand were price inelastic.
Answers
Answer:
b. The mayor would be correct if demand were price inelastic; the city manager would be correct if demand were price elastic.
Explanation:
-An elastic demand is when the change in the price generates a high percentage change in the quantity demanded.
-An inelastic demand is when the change in the price generates a low percentage change in the quantity demanded.
According to this, the answer is that the mayor would be correct if demand were price inelastic because the increase in price won't generate an important change in the demand which allows to increase the revenues and the city manager would be correct if demand were price elastic because the decrease in the price would generate a higher change increasing the demand which can allow to raise revenues.