Based on the U.S. historical experience with the gold standard, we can conclude that
A. the gold standard guarantees neither economic nor price stability.
B. the standard guarantees economic stability but not price stability.
C. the gold standard guarantees price stability but not economic stability.
D. the gold standard guarantees both economic and price stability.
Answer: A
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The figure above shows a nation's production possibilities frontier. If the marginal cost equals the marginal benefit at point A when 4 million pizzas are produced,
A) allocative efficiency is achieved but production efficiency is not achieved because there are no tacos being produced. B) both allocative and production efficiency are achieved. C) production efficiency is achieved but allocative efficiency is not achieved because there are no tacos being produced. D) production efficiency is achieved but allocative efficiency is not achieved because the number of tacos produced is at its absolute maximum. E) neither allocative nor production efficiency has been achieved.
If the quantity of money demanded exceeds the quantity of money supplied, then
A) the quantity of nonmonetary assets demanded exceeds the quantity supplied. B) the quantity of nonmonetary assets supplied exceeds the quantity demanded. C) the quantity of nonmonetary assets demanded will still equal the quantity supplied, all else being equal. D) you can make no conclusions about the relative supply and demand of nonmonetary assets.
____ in taxes will decrease consumption spending, and ____ in transfer will increase consumption spending
Fill in the blank(s) with the appropriate word(s).
Central banks can increase the money supply by:
a. Raising margin requirements. b. Selling government securities. c. Buying foreign exchange. d. Increasing the discount rate. e. None of the above.