The Fed engages in an expansionary money policy by ______ the money supply and ______ the interest rate.
a. decreasing; decreasing
b. decreasing; increasing
c. increasing; decreasing
d. increasing; increasing
c. increasing; decreasing
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If the average cost curve is downward sloping, then
a. marginal cost is smaller than average cost. b. the marginal cost curve is also downward sloping. c. there are increasing marginal returns to labor. d. wages and other input prices are falling.
Policy makers find that creating inflation is much more difficult than creating disinflation because expectations begin to change as inflation takes hold
a. True b. False Indicate whether the statement is true or false
Which of the following statements is not true?
a. Because the quantity of Bitcoins is capped at about 21 million in 2040 it is practically impossible for the currency to ever be a significant threat to large nations, like the United States and Japan, whose money supplies are measured in the trillions of dollars and yen. b. Bitcoins can be bought, traded, and earned by solving a time-consuming computer algorithm. c. Bitcoins are becoming more widely accepted by real-world merchants. d. None of the statements above is false. They are all true.
Money's basic advantage as compared to barter is that
A) everybody has money but not everyone has the opportunity to barter. B) a money system relies on a double coincidence of wants. C) money reduces transaction costs. D) money is the only medium you can use to store your wealth.