When your grandfather keeps a bundle of $100 dollar bills behind a brick in the basement, this is an example of dollars serving as:
A. a store of value.
B. a medium of exchange.
C. bank reserves.
D. a unit of account.
Answer: A
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The above figure shows the short run cost curves for a typical firm in a competitive market. If price = 8, then the firm
A) is earning positive profits. B) should produce 50 units. C) should shut down. D) None of above.
Which of the following is most likely to be an inferior good?
a. airline travel b. restaurant meals c. a subscription to the Wall Street Journal d. soft drinks e. used clothing
Answer the following statement(s) true (T) or false (F)
1.Automatic stabilizers can counter a major recession on their own. 2.During typical economic conditions, automatic stabilizers are more likely to help than discretionary expansionary or contractionary fiscal policy. 3.Budget deficits give the government flexibility to deal with crisis situations. 4.The largest budget deficits are usually created during wars. 5.Economists often look at the ratio of national debt to GDP.
Which of the theory is better to think about policy?
A) game theory B) optimal control theory C) expectations theory D) none of the above