Currency held outside banks is included in
A. M2 only.
B. neither M1 nor M2.
C. M1 only.
D. both M1 and M2.
Answer: D
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Consider a tax cut which affects not only consumer disposable income, but also after-tax earnings from labor supplied to labor markets and from financial assets acquired through saving. In the long run we would expect this tax cut to
A) increase both the price level and the level of real GDP. B) decrease both the price level and increase real GDP. C) increase the price level. D) increase the level of real GDP.
By the time the Civil War (1861–1865) ended, hyperinflation was a problem in both the North and the South
Indicate whether the statement is true or false
Imagine yourself to be a monopsonist producing strawberries in a small Florida farming community. a. You do not have to deal with the marginal revenue product of labor. b. You can control the price of the good. c. The wage rate is given to you and you can hire as many workers as you wish at that rate
d. You face an upward-sloping supply curve of labor and can choose any wage rate and labor combination shown on that curve. e. For your firm, labor is preferred to capital as a factor of production.
Which of the following is a positive economic statement?
a. Government control of rent is a fair way to help poor people afford housing. b. Government control of rent keeps landlords from charging too much rent. c. Government control of rent decreases the number of new apartments constructed. d. Government control of rent is an injustice.