If Real GDP increases at an annual rate of 4 percent and velocity increases at a rate of 1 percent per year, then rules-based monetary policy advocates who wish to maintain a stable price level would set the annual money supply growth rate at
A) 1
B) 2
C) 3
D) 4
E) 6
C
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Coordination of economic policies among nations is a prisoner's ________ because all countries will be better off if they ________
A) dilemma; cooperate B) conundrum; cooperate C) sentence; compete D) screed; compete E) quandary; collude
Suppose that for Emily, DVDs and trips to the movie theater are perfect substitutes. Currently, Emily is spending all of her income on trips to the movie theater. If the price of DVDs doubles, the substitution effect will
a. be two times the income effect. b. be half the income effect. c. be zero. d. always increase the number of trips to the movie theater Emily makes.
The process through which an economy's production possibilities curve shifts outward is:
A. full-employment management. B. investment. C. resource renewal. D. out-resourcing.
The Federal Reserve's surveys of bank loan officers can help the Fed determine whether:
A. a drop in the quantity of loans granted resulted from fewer applications or a tightening of credit standards. B. an increase in the quantity of new loans was due to a decrease in supply or an increase in demand. C. climbing interest-rate spreads are the result of more borrowers or fewer loans being granted. D. an increase in the quantity of loans granted resulted from fewer applications or a tightening of credit standards.