Why are Federal Reserve Notes (U.S. dollar bills) money in the U.S? Because
A) they are backed by gold.
B) they are used as a general medium of exchange.
C) they are created by the government.
D) they would otherwise be useless.
E) of all the above reasons.
B
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All else equal, an increase in the government's budget deficit accompanied by a decrease in corporate taxes would definitely result in
A) an increase in the equilibrium real interest rate. B) a decrease in the equilibrium real interest rate. C) an increase in the equilibrium level of saving and investment. D) a decrease in the equilibrium level of saving and investment.
Government regulation of _______________ protects customers from high prices in situations where there is no competition that would ordinarily keep prices down.
a. natural monopolies b. monopolistic competition c. perfect competition d. luxury markets
Economists define an aggregate as
a. a concrete object. b. a specific principle. c. a representative good or service. d. a useful abstraction. e. something immeasurable.
Characteristics of the "invisible hand" concept include all of the following, except
A. Simple markets. B. Individuals and firms pursue their own self-interest without any central direction or regulation. C. A complete lack of government involvement in the economy. D. All of the choices are characteristics of the "invisible-hand."