Financial assets that represent the partial ownership of a firm and ability to share in its profits are called:
A. equities.
B. debt certificates.
C. intermediaries.
D. credit risks.
A. equities.
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Refer to Figure 13.2. If Oliver's political views place him at the L4 position and George's political views place him at the C4 position, Cindy's preference for mayor is
A) Oliver Cousins. B) George Glass. C) Cindy is indifferent between the two candidates. D) Cindy definitely does not like either candidate.
Referring to a production possibilities curve and the goods being compared, depict the economic event. Suppose the United States was at full employment in 2003 just before invading Iraq. Although the war was won quickly, winning the peace took a decade (guns vs. butter).
A. A movement from a point on or near the curve to a point inside the curve B. A shift in the entire curve to the right (outward) C. A shift in the entire curve to the left (inward) D. A movement along the curve
The monetarists believe that an increase in the money supply of about 4% per year, regardless of economic conditions, is a good monetary policy. Why was 4% chosen?
A. It reflects the fact that the output of the economy has been growing at about 3 to 4% per year, and a 4% increase in the money supply would tend to stabilize the price level. B. By equating the money supply growth rate and the unemployment rate, the monetarists believe that the output of the economy will increase. C. By restricting the increase in money supply to 4%, the monetarists hope to limit fluctuations in the price trend to 4% and stabilize velocity. D. Price fluctuations have been shown to be historically more than 4%. By a steady 4% increase in the money supply, the monetarists hope to drive prices down.
A rise in real income will have which of the following effects on money demand?
a. The money demand curve will shift out. b. The money demand curve will not shift at all. c. The money demand curve will shift in. d. Real income has no effect on money demand.