Suppose the government has a $900 billion budget deficit. If the government borrows $560 billion to finance this deficit and finances the rest by printing money, the amount of new money created will be
A) $340 billion. B) $560 billion. C) $900 billion. D) $1,460 billion.
A
You might also like to view...
The definition of M2 includes
I. M1. II. money market mutual funds. III. currency held outside of banks. A) I and II only B) I and III only C) II and III only D) I, II, and III
Assume that the central bank sells government securities in the open market. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the current international transactions balance and monetary base in the context of the Three-Sector-Model? State your answer after the macroeconomic system returns to complete equilibrium. a. The current
international transactions balance becomes more positive (or less negative) and monetary base rises. b. The current international transactions balance becomes more negative (or less positive) and monetary base falls. c. The current international transactions balance and monetary base more negative (or less positive). d. The current international transactions balance and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
If tax revenues from a cigarette tax are used to pay for healthcare expenses related to lung cancer, the cigarette tax could be justified using the __________
Fill in the blank(s) with correct word
What are variable costs?
a. costs that change with the level of output b. costs that do not change when output rises c. costs that rise when output decreases d. costs that do not affect long-run average total cost