Demand for a good is likely to be less elastic
a. the more narrowly defined the good is
b. the larger the good's share of the buyer's budget
c. in the long run than in the short run
d. the smaller the number of substitute goods available
e. at high prices
D
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When money prices are used to facilitate comparisons of value, money is said to function as a
A) unit of account. B) medium of exchange. C) store of value. D) payments-system ruler.
When economists refer to the economy’s self-correcting mechanism, they are referring to the fact that the
A. economy will react automatically to a recessionary gap through inflation. B. economy will react automatically to an inflationary gap through deflation. C. economy will react automatically to an inflationary gap through inflation. D. simple multiplier is greater than the complex multiplier.
If the Fed increases the required reserve ratio, how will this affect excess reserves and the money supply?
a. Both will increase. b. Excess reserves increase and the money supply decreases. c. Both will decrease. d. Excess reserves decrease and the money supply increases.
Which of the following will result in an increase in the output of a nation?
a. A decrease in exports b. A decrease in investment spending c. A decrease in interest rates d. A decrease in consumption