Firms often seek to borrow money to expand their capital stock, and the price they pay for that money is the interest rate. What happens to the demand for money if the interest rate increases?
a. It increases.
b. It decreases.
c. It does not change.
d. The quantity of money demanded will increase.
c
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If there is a monopsony operating in the labor market illustrated in the figure above, the equilibrium wage and quantity of labor hired is
A) $15 and 50 hours. B) $10 and 100 hours. C) $10 and 50 hours. D) $5 and 50 hours.
People continue to value money because they have confidence in its convertibility into goods and services
a. True b. False Indicate whether the statement is true or false
Which of the following statements about economic fluctuations istrue ?
A. A variety of spending, income, and output measures can be used to measure economic fluctuations because most macroeconomic quantities tend to fluctuate together. B. Economic fluctuations have been termed the "business cycle" because the movements in output are regular and predictable. C. A depression is a mild recession. D. A recession is when output rises above the natural rate of output. E. None of these answers are true.
The gap between a country's potential output and its consumption is most directly related to its:
A. exchange rate. B. budget deficit. C. comparative advantage. D. trade deficit.