Suppose Bob withdraws money from his savings account and deposits it into his checking account. What happens to M2?
A. It decreases.
B. It increases.
C. It stays the same.
D. The effect is unknown.
Answer: C
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To calculate GDP using the income approach, one of the adjustments made to net domestic product at factor cost is to
A) add investment. B) subtract indirect taxes less subsidies. C) add consumption expenditure. D) subtract investment. E) add depreciation.
When the inflation rate is negative, the
A) real interest rate is greater than the nominal interest rate. B) real interest rate is less than the nominal interest rate. C) nominal interest rate is zero. D) real interest rate equals the nominal interest rate.
In a market system, the what, how and for whom questions in economics are determined by
A) those who are not in the market. B) buyers and sellers together. C) the central authority. D) no one.
All but which one of the following could be expected to result from rent controls?
a. an increase in housing b. substandard housing c. waiting lists for housing d. a decline in apartment construction e. black market in housing