In the equation of exchange, the money supply multiplied by velocity equals
A) GDP.
B) the price level.
C) the quantity of goods produced.
D) the average number of times that a dollar is used to purchase a final good or service.
A
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When the social costs of producing or consuming a good exceed the private costs, _____
a. a positive externality exists b. an inefficiently high quantity of the good will be produced and consumed, from the society's point of view c. the direct consumers of the good will bear the external costs d. the individuals involved in the production of the good do not bear the private costs e. the quantity of the good produced will be less than the socially efficient level
In Operation Desert Storm, oil facilities in Iraq were attacked amid strong demand for oil. In response, political pressure motivated OPEC to increase the daily quota by 2 million barrels a day. Assuming demand did not change, which of the following series of prices most likely matches how the price of a barrel of oil changed from (1) before the attack, to (2) just after the attack, to (3) after OPEC increased the quota?
A. $40, $42, $38 B. $42, $38, $40 C. $38, $40, $42 D. $42, $40, $38
If the supply curve intersects the vertical (price) axis, the supply curve has an elasticity:
A. greater than 1. B. less than 1. C. that is indeterminate. D. equal to 1.
Depository institutions are good at minimizing
A) the costs of monitoring borrowers. B) risky borrowers. C) liquidity. D) all of the above.