The circular flow shows that the household sector earns its income by
A) selling factors of production.
B) buying factors of production.
C) selling goods and services.
D) selling financial assets.
A
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A consequence of hyperinflation is that people
A) increase the quantity of money demanded. B) receive higher real wage hikes, which increases their purchasing power for goods and services. C) who make fixed-payment loans to others receive higher payments as inflation increases. D) spend time trying to keep their money holdings near zero. E) want to lend funds because interest rates are so high.
If money demand does not depend upon income, then
a. monetary policy cannot have any effect upon the economy. b. monetary policy will only affect the level of the price level. c. monetary policy will only affect interest rates. d. monetary policy will have a larger impact on income.
Two games that differ only in the timing of moves—one simultaneous, the other sequential move—can sometimes have completely different subgame-perfect equilibria. Why?
a. The second mover to choose non-credible threats. b. The first mover can choose an action that it would deviate from if its action were secret. c. Subgame-perfect equilibrium cannot be applied to simultaneous games. d. All of the above.
In seeking to explain what determines GDP, monetarists focus on the money supply while Keynesians focus on the spending components of total expenditures
Indicate whether the statement is true or false