Changes in the money supply are ________ to other economic variables, and since the early 1990s the Fed has ________ in monetary policymaking
A) closely connected; emphasized the role of M2 over M1
B) closely connected; emphasized the role of M1 over M2
C) closely connected; emphasized the roles of both M1 and M2
D) no longer closely connected; deemphasized the roles of M1 and M2
D
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Suppose we observe the following sequence of production and exchange: sand is used to make silicon; silicon is used to make silicon chips; silicon chips are used to make computers; computers are sold to retailers; retailers sell those computers to
consumers. Which represents the purchase of a final good? A) The retailer's purchase of computers B) The consumer's purchase of computers C) Both A and B above. D) None of the above.
If investment spending increases due to increased optimism in the business sector, which of the following would occur?
a. an increase in GDP, an increase in the price level, an increase in money demand, and an increase in the interest rate b. an increase in GDP, a decrease in the price level, an increase in money demand, and a decrease in the interest rate c. a decrease in GDP, a decrease in the price level, a decrease in money demand, and a decrease in the interest rate d. a decrease in GDP, a decrease in the price level, an increase in money demand, and an increase in the interest rate e. an increase in GDP, an increase in the price level, a decrease in money demand, and a decrease in the interest rate
Which of the following examples illustrates a progressive income tax?
a. I earn $500 and pay $50 in taxes; you earn $1,000 and pay $100 in taxes. b. I earn $500 and pay $50 in taxes; you earn $1,000 and pay $50 in taxes. c. I earn $500 and pay $50 in taxes; you earn $1,000 and pay $80 in taxes. d. I earn $500 and pay $50 in taxes; you earn $1,000 and pay $125 in taxes.
To obtain the market demand curve for a product, sum the individual demand curves
a. vertically. b. diagonally. c. horizontally. d. and then average them.