If the money supply grew by 6 percent and velocity fell by 2 percent, nominal GDP would:
a. fall by 4 percent
b. rise by 4 percent.
c. rise by 8 percent.
d. rise by 12 percent.
b
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A speculator may choose to buy a call option because
A) the possible gain is greater than with a futures contract. B) the potential loss on the call is limited to the premium, while the potential loss is unlimited with a futures contract. C) the possible gain with the option is great than the possible gain from buying the underlying stock itself. D) calls eliminate the risk of loss so a speculator can lose nothing or just make a gain.
Jobs in rural areas generally pay lower wages than jobs in urban areas because there are limits to labor mobility
a. True b. False
Which one of the following is a tool of monetary policy for altering the reserves of commercial banks?
a. Budget surplus or budget deficit b. Federal Reserve Notes c. Treasury deposits d. Reserve ratio
A positive cross price elasticity of demand between two goods suggests that the goods are
A) not related. B) complements. C) substitutes. D) both of unitary elasticity.