The quantity theory of money assumes that
a. the national economy tends to operate at less than full.
b. the velocity of money is unstable.
c. the national economy tends to operate at full employment.
d. the velocity of money varies with changes in interest rates.
c. the national economy tends to operate at full employment.
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The monetary base will increase if
A) currency outstanding decreases. B) loans by the Fed to commercial banks decrease. C) bank reserves increase. D) vault cash in banks increases.
Which of the following is the objective of expansionary monetary policy?
A. an increase in employment B. a decrease in employment C. an increase in the velocity of money D. an increase in prices proportional to the rise in the money supply
The figure above illustrates a linear demand curve. In the range from $8 to $6
A) the demand is price elastic. B) the demand is unit elastic. C) the demand is price inelastic. D) more information is needed to determine if the demand is price elastic, unit elastic, or inelastic.
Refer to Figure 11-2. The curve labeled "E" is
A) the output supply curve. B) the average product curve. C) the marginal product curve. D) the total product curve.