Subtracting borrowed reserves from the monetary base obtains
A) reserves.
B) high-powered money.
C) the nonborrowed monetary base.
D) the borrowed monetary base.
C
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To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.
What is barter? What is a double coincidence of wants? How does the existence of money affect barter?
What will be an ideal response?
If the exchange rate is equal to the ratio of the domestic and foreign price indexes,
A) absolute PPP holds. B) relative PPP holds. C) one currency is said to be overvalued. D) one currency is said to be undervalued.
The selection of particular products' production processes
a. determines the output of other products made with those inputs at the same time. b. is part of the distribution problem in an economy. c. is accomplished without regard to profit in a laissez-faire economy. d. depends upon plans for distribution of the products.