Keynesian economists believe that
a. the velocity of money is stable
b. changes in the money supply do not affect output
c. there is a one-to-one correspondence between M and P in the equation of exchange
d. the velocity of money is predictable
e. the velocity of money is affected by changes in expectations
E
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A fall in the rate of people's time preference in general tends to
A) increase interest rates. B) decrease interest rates. C) have no effect on interest rates. D) have no effect at all in the market for credit.
The three main methods that governments use to cope with an external cost of production include all of the following EXCEPT
A) taxes. B) mandating clean technology. C) cap-and-trade D) price floors.
A common mistake made by consumers is the failure to take into account the monetary costs of their actions
Indicate whether the statement is true or false
If the dollar interest rate is 10 percent and the euro interest rate is 6 percent, then an investor should
A) invest only in dollars. B) invest only in euros. C) be indifferent between dollars and euros. D) invest only in dollars if the exchange rate is expected to remain constant. E) invest only in euros if the exchange rate is expected to remain constant.