To say that the relationship between the velocity of money and the opportunity cost of holding money is not stable is the same as saying:
A. money demand is not stable.
B. the supply of money is not stable.
C. the money market is always in disequilibrium.
D. money demand is stable.
Answer: A
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A rapid demographic transition should raise the saving rate
a. True b. False
What is the fundamental basis for trade among nations?
a. shortages or surpluses in nations that do not trade b. misguided economic policies c. absolute advantage d. comparative advantage
The IS-LM model was developed by
A) Friedman and Phelps. B) Hicks and Hansen. C) Modigliani and Friedman. D) Lucas and Sargent. E) none of the above
The most important advantage of discount policy is that the Fed can use it to
A) precisely control the monetary base. B) perform its role as lender of last resort. C) control the money supply. D) punish banks that have deficient reserves.