Assume that in the country of Salmon, the government tripled the money supply overnight. As a result of this action, the price of a loaf of bread increased from 1 bill to 100 bills. This is an example of
A. currency debasement.
B. deflation.
C. a change from commodity money to fiat money.
D. a change in the legal tender.
Answer: A
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Refer to Figure 2-8. Suppose Vidalia is currently producing 120 dozen roses per period. How many orchids is it also producing, assuming that resources are fully utilized?
A) 20 dozen orchids B) 32 dozen orchids C) 44 dozen orchids D) 68 dozen orchids
Which of the following statements concerning bank regulation in the United States is TRUE?
A) The Office of the Comptroller of the Currency has the primary responsibility for state banks that are members of the Federal Reserve System. B) The Federal Reserve and the state banking authorities jointly have responsibility for the state banks that are members of the Federal Reserve System. C) The Office of the Comptroller of the Currency has sole regulatory responsibility over bank holding companies. D) The state banking authorities have sole regulatory responsibility for all state banks.
When bond prices rise,
A. stock prices must fall. B. interest rates must fall. C. interest rates must rise. D. bankruptcies generally increase.
Within a game theory model, if a change in decision-making raises firm A's profits by $1 million and lowers firm B's profits by $1 million, the game is a
A. zero-sum game. B. cooperative game. C. positive-sum game. D. negative-sum game.