The economic scenario of the early 2000s did not include:
a. a stock market fall.
b. low interest rates.
c. a strong increase in employment.
d. a fall in real investment.
c. a strong increase in employment.
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In the quantity theory of money, the quantity of money is assumed to
A) not influence the velocity of circulation. B) rise during recessions. C) fall during recessions. D) be constant.
Suppose that the actual money multiplier equals the maximum potential money multiplier. If the reserve ratio is 10 percent, in order for the banking system to increase deposits by $2.5 million, the Fed must
A) permit the system to have prolonged reserve deficiencies. B) sell $2.5 million of government securities to the general public. C) sell $250,000 of government securities to the general public. D) buy $250,000 of government securities from the public.
Using the rule of 72, calculate the average annual growth rate of GDP needed for a country to double its size in just four years?
a. 12 percent b. 4 percent c. 18 percent d. 72 percent e. 28 percent
Since producers must be compensated for the rising opportunity cost that accompanies increases in output,
a. the law of demand applies to most markets b. supply curves usually slope downward c. demand curves usually slope downward d. supply curves usually slope upward e. technical inefficiency would not exist in the long run