If the velocity of money remains unchanged and the economy is at full employment, then the equation of exchange predicts that a rise in the money supply will:
A. Increase prices
B. Increase interest rates
C. Increase real output
D. Decrease nominal GDP
A. Increase prices
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Roy just got a big promotion at work which includes a sizable pay increase. Roy's demand for Ramen Noodles, an inferior good, will likely:
A. decrease, and his demand curve will shift to the right. B. decrease, and his demand curve will shift to the left. C. increase, and his demand curve will shift to the right. D. decrease, causing a movement down along his demand curve.
If minimum wage legislation does not cause unemployment, then:
A. those who work for minimum wage will benefit. B. firms will generally gain by earning higher profits. C. minimum wages may still be binding for many employees. D. most likely the government won’t study how minimum wage legislation may affect employment.
Education is
A. generally financed at the state and local level. B. too expensive for the federal government. C. generally financed at the federal level. D. financed on a voluntary basis.
In a diagram of perfect competition, the marginal revenue line moves up and down when there is exit and entry, respectively, because
A. the market demand for the good rises and falls when there is entry and exit, respectively. B. the market supply for the good rises and falls when there is exit and entry, respectively. C. the market supply for the good rises and falls when there is entry and exit, respectively. D. the market demand for the good rises and falls when there is exit and entry, respectively.