In a market economy, we know that a resource has become scarcer when
a. its price rises relative to other prices.
b. it is non-renewable and some of it is used.
c. people search for substitutes.
d. All of the above are correct.
a
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Suppose nominal GDP is $2,000 a year and the quantity of money is $400. Then the velocity of circulation equals
A) 10. B) 1/5. C) 2. D) 8. E) 5.
For most goods and services the income elasticity of demand is
A) negative. B) positive. C) invisible. D) inverse.
The 2001-2007 economic expansion began when a change in Federal Reserve policy and other global conditions caused interest rates to drop and stay low
a. True b. False
One reason the oversimplified multiplier is incorrect is that inflation
a. increases the multiplier by increasing investment spending. b. increases the multiplier by increasing consumer spending. c. decreases the multiplier by increasing net exports. d. decreases the multiplier by decreasing consumer spending.