Increases in leakages cause the money multiplier to:
a) stay the same.
b) increase.
c) decrease.
d) fall to zero.
Ans: c) decrease.
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Due to society's overall scarcity of resources,
a. only households are constrained by income b. only government agencies are constrained by limited budgets c. only business firms are constrained by the cost of buying their inputs d. households, business firms and government agencies all face constraints e. households and business firms face constraints, but government agencies do not
Which of the following is least likely to result in inflation?
a. A drought in California that causes farm production to fall. b. The government printing money to finance deficits. c. A reduction in consumer confidence. d. Rising instability in oil-producing nations.
A shortage creates a situation that forces prices to ________ while a surplus creates a situation that forces prices to ________
A) decrease; increase B) decrease; decrease C) increase; decrease D) increase; increase
If national laws protecting the health and safety of workers completely eliminate any and all risk, then
A) more people would be employed. B) workers in risky occupations become better off. C) compensating differentials would grow because workers could not be compensated by being given lower risk jobs. D) compensating wage differentials disappear and workers in risky occupations may be no better off.