To correct the budget deficit for inflation, we should
A. multiply the budget deficit by the price deflator for GDP.
B. subtract interest payments from tax revenues.
C. divide the budget deficit by nominal GDP.
D. divide the budget deficit by the consumer price index.
Answer: C
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Which of the following is false?
A. The U.S. has had twelve recessions since January 1945. B. The U.S. has had a great deal of stagflation in the 1970s. C. The U.S. has not had a depression since the 1930s. D. The U.S. had rising inflation all throughout the 1990s.
In 2008 and 2009, the quantity theory of money did a ________ job of predicting year-to-year changes in the inflation rate because ________
A) good; interest rates behaved predictably B) poor; the Fed changed the growth rate of the quantity of money too quickly C) poor; velocity of circulation plunged D) good; real GDP remained stable E) poor; the price level and the velocity of circulation did not change
An exogenous increase in the country's trade balance shifts the
a. IS schedule to the left. b. IS schedule to the right. c. LM schedule to the left. d. LM schedule to the right.
What is the "store of value" function of money?
a. A common measurement of the relative value of different goods and services. b. The ability of money to hold value over time c. The quality of money not to be hoarded because of its commodity value. d. The function of money to be widely accepted I exchange for goods and services.