The gold standard
A. worked well until World War II.
B. will not work well when the world's gold supply increases as fast as the world's need for money.
C. fell apart as the Great Depression spread, as nation after nation devalued its currency.
D. makes monetary policy more effective.
C. fell apart as the Great Depression spread, as nation after nation devalued its currency.
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An economy is at a short-run equilibrium as illustrated in the above figure. An appropriate fiscal policy option to move the economy to full employment is to
A) lower the interest rate by increasing the quantity of money and move the economy to a full-employment equilibrium at point b. B) increase government expenditure and move the economy to a full-employment equilibrium at point b. C) increase tax rates and move the economy to a full-employment equilibrium at point c. D) increase government expenditure and move the economy to a full-employment equilibrium at point c. E) increase tax rates and move the economy to a full-employment equilibrium at point b.
Java Joe sells 200 cups of coffee each day in a perfectly competitive market at the market price of $2.00 per cup. If Java Joe independently decreased its price per cup to $1.50,
a. its sales would rise to 250 cups b. its revenue would decrease c. its revenue would rise d. its total revenue would equal $200 e. the market price will fall to $0.75 as other coffee sellers match the price cut
A ________ is a simplified representation of a problem that captures the essential issues.
A. hypothesis B. precept C. model D. theorem
Keeping interest rates stable is:
A. a key goal, because stable interest rates will result in all other goals being achieve B. not a goal of the central bank. C. a secondary goal for central banks. D. the most important goal for a central bank.