During periods of hyperinflation, which of the following is the most likely response of consumers?
A. Save as much as possible.
B. Spend money as fast as possible.
C. Invest as much as possible.
D. Lend money.
Answer: B
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The table above shows Tom's total utility from milkshakes and sodas. Tom's total budget for milkshakes and sodas is $20.00 per week. Milkshakes cost $2.00 each and sodas cost $.50 each
What quantity of milkshakes does Tom purchase at his consumer equilibrium? A) five B) six C) seven D) eight
Refer to Figure 15-1. In the figure, the money demand curve would move from Money demand1 to Money demand2 if
A) the price level decreased. B) the interest rate increased. C) the Federal Reserve sold Treasury securities. D) real GDP increased.
Keynes believed that an increase in savings would:
A. raise aggregate demand by increasing consumption. B. raise aggregate demand by reducing investment. C. reduce aggregate demand by reducing investment. D. reduce aggregate demand by reducing consumption.
Which of the following will most likely increase aggregate demand?
A. a decrease in stock market prices B. an increase in business investment spending C. a decrease in the expected inflation rate D. a decrease in real GDP