How is money destroyed in the banking system?
The process of money creation can be reversed, and in the process, money is destroyed. When a person pays a loan back to a bank, she usually does so by writing a check to the bank for the amount due. As a result, demand deposits decline, directly reducing the money stock.
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Economists emphasize the importance of ____ in analyzing demand.
A. quantity B. market potential C. wants and needs D. price E. sales opportunities
A retirement system in which the benefits government pays to retirees are paid out of the contributions those retirees make during their working years is called a
A) pay-as-you-go system. B) fully funded system. C) pension plan. D) deferred retirement system.
Over time, nations tend to converge to
A) the same balanced growth path and same income per capita. B) the same balanced growth path but varying income per capita. C) different balanced growth paths but the same income per capita. D) different balanced growth paths because of varying income per capita.
Which of the following about capital income is not correct?
A) It refers to a firm's revenue. B) It is also called profit income. C) It goes to the firms. D) It accounts for less than 35% of income in advanced countries.