The velocity of circulation is the
A. speed at which the multiplier takes effect.
B. speed at which money circulates.
C. speed at which tax cuts get spent.
D. rate at which money creation takes place.
Answer: B
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
Regardless of the index we use:
A. the measurement of inflation is the same, so we use the one easiest to calculate. B. we get the same measurements for inflation, so each is equally useful. C. inflation is measured as a percent increase in the index from one year to the next. D. we should get an accurate picture of how all consumer goods and services prices changed from year to year.
________ of unemployment during ________ make it easier for workers to ________ wages
A) High levels; a recession; accept lower B) Low levels; an expansion; accept lower C) Low levels; a recession; negotiate higher D) High levels; an expansion; negotiate higher
A monopolistically competitive industry has all of the following characteristics except
A. a large number of firms. B. product differentiation. C. there are no barriers to entry. D. strategic behavior.