A mutual fund company uses the funds of its investors to:
A. Produce goods and services for consumers
B. Buy stocks and bonds
C. Build factories and other infrastructure
D. Buy capital and other resources for other firms
B. Buy stocks and bonds
You might also like to view...
The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
The expectations-augmented Phillips curve implies that as expected inflation increases, nominal wages ________ to prevent real wages from ________
A) fall; rising B) fall; falling C) rise; falling D) rise; rising
If a government spends $20 billion on new bridges that have an expected life of 20 years, the expenditures would:
a. Increase government spending and government expenses by the full $20 billion even though a business would expense them over the 20-year period. b. Not change government spending and therefore would not change the government deficit because they are capital expenditures. c. Increase total government spending by the full amount (i.e., $20 billion), but only $1 billion of it would be considered part of the budget deficit because the $20 billion is amortized over the 20 years. d. Initially increase the budget deficit by an amount equal to $20 billion, but only $1 billion of it would be considered part of the government spending because the $20 billion is amortized over the 20 years.
Refer to Figure 14.2. A movement from point d to point b could be caused by a(n):
A. increase in government spending. B. increase in the price of oil. C. increase in taxes. D. decrease in short-run aggregate supply.