Which of the following is true when the velocity of money falls?
a) an increase in the money supply will have less effect on nominal gross national product
b) a change in the money supply will affect output only
c) the fed will decrease the money supply
d) output will be greater for a given money supply
e) the public will increase its holdings of assets other than money
Ans: a) an increase in the money supply will have less effect on nominal gross national product
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The Occupational Safety and Health Administration (OSHA) has determined that 100 workers are exposed to a hazardous chemical used in the production of diet soft drinks. The cost of imposing a regulation that would ban the chemical is $10 million. OSHA has calculated that each person saved by this regulation has a value equal to $10 million. If the benefits are exactly equal to the costs, what
probability is OSHA using to assess the likelihood of a fatality from exposure to this chemical? a. 0.001 b. 0.01 c. 0.1 d. 1.0
For the Fed to use money growth as a direct monetary policy target, which of the following needs to exist?
A. A stable link between the monetary base and the quantity of money B. A highly variable deposit expansion multiplier C. A predictable link between the quantity of money and the deposit expansion multiplier D. A stable link between the monetary base and the quantity of money and a predictable relationship between the quantity of money and the rate of inflation
Suppose actual investment is greater than planned investment at the current level of output in a given year. Given this information, we know that
A. saving must be equal to planned investment in that year. B. firms' stock of inventories must have increased unexpectedly in that year. C. saving must be less than planned investment in that year. D. GDP will tend to increase over time.
Which firm in Figure 26.5 is using marginal cost pricing?
A. Firm C only. B. Firms B and D only. C. Firm B only. D. All of the firms are using marginal cost pricing.