Answer to Question #214164 in Macroeconomics for Ebi

Question

1. Which of the following is the highest liquid asset?

a.

Equipment

b.

Shares

c.

Bond

d.

Money

2.The main assumption behind .……….…….. is that the economy is populated by a group of identical individuals. The behavior of the group can then be explained in terms of the behavior of one individual, called a ………..…... agent .

a.

real business cycle models ; representative

b.

Keynessian model ; irrational

c.

Keynessian model ; individualistic

d.

real business cycle models ; rational.

3.Which of the following statements about classical and new classical models is FALSE?

a.

In the new classical model, economic agents form rational expectations.

b.

In the new classical model, economic agents do not make any mistakes in predicting the price level.

c.

In the classical model, labor suppliers even know the real wage.

d.

In the classical model, economic agents are assumed to have perfect information.

Answer 1

1)d.Money

2)a.Real business cycle models ; representative

3)c.In the classical model, labor suppliers even know the real wage.