All of the following shift the demand for money curve EXCEPT
A) a rise in the nominal interest rate.
B) an increase in the price level.
C) a decrease in real GDP.
D) an improvement in financial technology.
E) an increase in real GDP.
A
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In the Classical view, the money supply determines
A) interest rates. B) the saving rate. C) aggregate supply. D) the price level.
Use the above table. Assuming constant opportunity costs, the opportunity cost of producing donuts in country Alpha is ________, and the opportunity cost of producing donuts in country Beta is ________
A) 1 donut; 0.17 donut B) 1 donut; 6 donuts C) 10 donuts; 12 pizzas D) 0.2 pizza; 1.67 donuts
Assume the peanut industry, a perfectly competitive industry, is in long-run equilibrium with a market price of $5. If demand for peanuts increases and this industry is a decreasing-cost industry, long-run equilibrium will be reestablished at a price
A. equal to $5. B. less than $5. C. greater than $5. D. either greater than or less than $5, depending on the number of firms that enter the industry.
Hypothetical economy: C=$600 billion, I=$300 billion, G=$150 bill Assume for the long run: 1. For every 1% increase (decrease) in interest rate, planned investment decreases (increases) by $5 billion. 2. For every $10 billion increase (decrease) in government spending, interest rate increases (decreases) by 1%. 3. The MPC = 0.8 When government spending increases by $30 billion, the crowding-out effect can be represented by a
A) $30 billion decrease in investment. B) $15 billion decrease in investment. C) 3% decrease in the interest rate. D) 1% increase in the interest rate.