What impact did colonial inflation have on the colonial economy?
(a) An overall increase in private consumption spending in colonial America
(b) A decrease in interest rates in colonial America
(c) A decrease in colonial exports and a rise in colonial imports
(d) An increase in the exchange rates between colonial money and specie
(c)
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In the ISLM framework, a declining price level causes
A) interest rates to rise. B) income to fall. C) saving to rise. D) the LM curve to shift to the right.
A tax imposed on the sellers of a good will raise the
a. price paid by buyers and lower the equilibrium quantity. b. price paid by buyers and raise the equilibrium quantity. c. effective price received by sellers and lower the equilibrium quantity. d. effective price received by sellers and raise the equilibrium quantity.
The concept of limited liability
A) does not apply to a corporation. B) means that the owners of a corporation have liability limited to the value of the shares in the firm. C) means that owners of a firm are subject to double taxation. D) limits the amount of specialization that can occur in a firm.
Explain how the GDP and the interest rate are related to the transactions demand and asset demand for money.
What will be an ideal response?