The large quantity of currency held per person in the United States reflects
A) The high level of GDP per person in the United States.
B) The income-expenditure identity.
C) The importance of the underground economy.
D) The distrust of banks in the United States.
C
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Other things constant, when households decide to save more, the supply of credit ________ and interest rates ________
A) falls; rise B) falls; fall C) rises; rise D) rises; fall
The opening of export markets for primary products can provide employment for previously underutilized land and labor. The term for this is
(a) vent for surplus. (b) comparative advantage. (c) Prebisch-Singer thesis. (d) barter trade.
Seigniorage refers to
A) real resources a government earns when it prints money to use for spending on goods and services. B) nominal resources a government earns when it prints money to use for spending on goods and services. C) real resources a government earns when it prints money. D) nominal resources a government earns when it prints money. E) real resources a government earns when it issues bonds to use for spending on goods and services.
In the ISLM framework, monetary policy has the greatest impact on equilibrium income
A) when money demand = money supply. B) when money supply is infinitely elastic. C) when the interest rate is high. D) the less is the interest-sensitivity of money demand.