The two links between the goods market and the money market are income and the interest rate
Indicate whether the statement is true or false
Ans: True
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If the income elasticity of a good is negative, then
a. the good must be a Giffen good. b. the substitution and income effects must be moving in the same direction. c. the Engel curve for this good must be downward sloping. d. the law of demand must be satisfied for this good.
Which of the following would encourage economic growth through increases in the capital stock?
A) an increase in household saving B) a decrease in the government deficit C) a change from an income tax to a consumption tax D) all of the above
National income is defined as
A) gross domestic product less the consumption of fixed capital. B) gross national product plus transfer payments. C) gross domestic product less retained earnings plus transfer payments. D) gross national product less retained earnings plus transfer payments.
The aggregate demand curve is the total quantity of an economy's
A) intermediate goods demanded at different inflation rates. B) intermediate goods demanded at a particular inflation rate. C) final goods and services demanded at a particular inflation rate. D) final goods and services demanded at different inflation rates.