In comparison to commodity money, paper money
a. is not portable.
b. has no intrinsic value.
c. is not divisible.
d. cannot be stored.
e. All of the above are correct.
b
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An increase in investment can lead to a greater increase in aggregate demand if the value of the spending multiplier is: a. greater than 1
b. less than 1 but more than zero. c. negative. d. exactly equal to zero. e. exactly equal to one.
In response to the severe recession of 2008-2009, the Fed
a. expanded the monetary base and pushed short-term interest rates sharply higher. b. reduced the size of the monetary base and pushed short-term interest rates sharply higher. c. more than doubled the size of the monetary base and pushed short-term interest rates to near zero. d. more than doubled the size of the monetary base and pushed short-term interest rates to a historic high.
Patents turn new ideas into
a. public goods, and increase the incentive to engage in research. b. public goods, but decrease the incentive to engage in research. c. private goods, and increase the incentive to engage in research. d. private goods, but decrease the incentive to engage in research.
The opportunity cost of capital owned by the firm should reflect
A. the return foregone by using the capital rather than renting it to another firm. B. acquisition cost. C. wage rate differences. D. both a and b