Money market mutual funds are hard to classify because they are used both for making transactions and savings
Indicate whether the statement is true or false
TRUE
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The income effect of a wage decrease examines the effect of the decrease in wage income on a worker's ability to purchase goods and services
Indicate whether the statement is true or false
High-powered money is
A) total deposits received by banks within the system. B) reserves held by banks to meet withdrawals. C) deposits divided by the reserve holding ratio. D) the reserve holding ratio divided by the level of deposits.
A firm built an inventory of 16-bit chips for $50,000 last year. However, the introduction of 32-bit chips lowers the market price for 16-bit chips and the inventory can only be sold for $40,000 now. What is the sunk cost?
A) $50,000 B) $40,000 C) $10,000 D) $90,000
If decreased government borrowing drives down real interest rates in the United States,
a. private investment will tend to decline. b. the dollar will depreciate leading to an increase in net exports. c. an inflow of capital will cause the dollar to depreciate. d. All of the above are true.