If the money multiplier is 3.0, a $1,000 increase in the monetary base
A) increases quantity of money by $3,000.
B) decreases the quantity of money by 3 percent.
C) increases the monetary base by $300.
D) increases the money multiplier by 3 percent.
E) decreases quantity of money by $3,000.
A
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Country A has a capital—labor ratio that is initially twice as big as that of country B, but neither is yet in a steady state. Both countries have the same production function, f(k) = 6k1/2
Country A has a 10% saving rate, 10% population growth rate, and 5% depreciation rate, while country B has a 20% saving rate, 10% population growth rate, and 20% depreciation rate. (a) Calculate the steady-state capital—labor ratio for each country. Does the initial capital—labor ratio affect your results? (b) Calculate output per worker and consumption per worker for each country. Which country has the highest output per worker? The highest consumption per worker?
Use the following graph to answer the next question.The graph shows the cost curves for a perfectly competitive firm. If the market price of the product is $1.25 per unit,then the firm will earn how much in profits/losses in the short run?
A. $25 B. $9 C. -$9 D. -$12
If there is a recessionary expenditure gap of $100 billion and the MPC is 0.80, by how much must taxes be reduced to eliminate the recessionary expenditure gap?
What will be an ideal response?
An increase in demand is an increase in the quantity people are willing and able to purchase at ________.
Fill in the blank(s) with the appropriate word(s).