If there is an increase in the amount of currency held outside banks, then the
A) quantity of money and the monetary base will decrease.
B) monetary base will decrease.
C) quantity of money will increase.
D) quantity of money will not change.
E) quantity of money will decrease.
E
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Everything else held constant, a shift in tastes in the U.S. toward Mexican goods will ________ net exports in the U.S. and cause the quantity of aggregate output demanded to ________ in Mexico
A) decrease; rise B) decrease; fall C) increase; rise D) increase; fall
A monopoly faces an inverse demand curve of P = 100 - 2Q. The marginal cost curve is MC = .5Q. What government price ceiling would represent optimal price regulation?
What will be an ideal response?
Super Haulers is a hauling company and delivers large and heavy materials to construction job sites. Super Haulers is considering purchasing a new dump truck that costs $185,000 and the managers of Super Haulers have estimated that the new dump truck will generate $50,000 a year in future operating profit for the next four years. At the end of four years, Super Haulers can sell the dump truck at
a salvage price of $20,000. If the discount rate is 5 percent, which of the following is true if the managers of Super Haulers are profit-maximizing? A) The manager should not make the investment because the net present value is negative. B) The manager should make the investment because the net present value is positive. C) The manager should make the investment because the net present value is negative. D) The manager should not make the investment because the net present value is positive.
Suppose that the nominal value of GDP increased by approximately 2 percent during a given year, but real GDP decreased by 3 percent. Which of the following best explains these events?
a. The money supply decreased by approximately 5 percent. b. Prices fell by approximately 5 percent. c. Prices increased by approximately 5 percent. d. The real productive capacity of the economy increased by approximately 5 percent.