Assume monetary equilibrium exists—that is, the desired and the actual supply of money are equal—when nominal GDP equals $480 billion and the money supply is $160 billion. According to a strict monetarist view, an increase in the money supply of $10
billion will increase the nominal GDP by:
A. $30 billion.
B. $25 billion.
C. $20 billion.
D. $10 billion.
A. $30 billion.
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Discuss how a politicians "policy differentiation" from his opponent in an election softens the competition over how much in political rents the politician will be able to collect.
What will be an ideal response?
When a market has barriers to entry,
A) then in the long run it is possible for the firms to incur economic losses. B) then in the long run the only possible outcome for the firms is zero economic profit. C) then in the long run it might be possible for the firms to make economic profits. D) oligopolies cannot be created. E) the HHI almost always falls below 1,000.
Refer to Figure 10-7. Suppose the price of Pilates sessions rise to $30 while income and the price of Yoga sessions remain unchanged. The substitution effect of this price change is represented by the movement from
A) A to B. B) A to C. C) A to D. D) D to B.
Assuming initially that the required reserve ratio = 10%, the currency-deposit ratio = 75%, and the excess reserve ratio = 156%, an increase in the required reserve ratio to 15% causes the M1 money multiplier to ________, everything else held
constant. A) increase from 0.15 to 0.33 B) increase from 0.54 to 0.67 C) decrease from 0.73 to 0.71 D) decrease from 1.67 to 1.54