If an economy produces 1,000 units of output with a price level of $5 and the money supply (M) is $1,000, velocity is:

A. 50.
B. 200.
C. 5.
D. 2.


Answer: C

Economics

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If the required reserve ratio decreases, the:

a. money multiplier increases. b. money multiplier decreases. c. amount of excess reserves the bank has decreases. d. money multiplier stays the same. e. amount of excess reserves stays the same.

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a. households and businesses, but not governments. b. households, businesses, and the federal government, but not state and local governments. c. households, businesses, and all governments except foreign ones. d. households, businesses, and governments, both domestic and foreign.

Economics

A country produces two goods, soda and chips. It currently exports soda and imports chips. If it were to impose a tariff on chips,

a. both imports of chips and exports of sodas would rise. b. imports of chips would rise, but exports of sodas would fall. c. imports of chips would fall, but exports of sodas would rise. d. both imports of chips and exports of sodas would fall.

Economics