Targeting money growth will lead to stable output growth only if
a. money demand and velocity change proportionally with output.
b. fiscal policy remains unchanged.
c. money demand and velocity are stable.
d. the IS curve is steep.
C
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Answer the following statement(s) true (T) or false (F)
1. Unlike a consumer, a competitive profit-maximizing firm faces no constraints. 2. Optimization typically requires use of the equimarginal principle. 3. A world in which most people are irrational would have to function much differently than a world in which most people are rational. 4. An economist uses a consumer's demand curve to express the solutions to a family of optimization problems. 5. Economic models of markets generally treat prices as exogenous variables.
At an equilibrium price for gasoline,
A. everyone who is willing and able to purchase gasoline at that price can do so. B. surpluses are inevitable. C. market forces will eventually change the quantities demanded and supplied. D. suppliers must be using the most efficient oil-drilling equipment available.
The simultaneous export and import of airplanes by the United States is an example of
A) increasing returns to scale. B) imperfect competition. C) intraindustry trade. D) interindustry trade.
Jason had $30 to spend on games and books. A game costs $5, while a book costs $3 . If he decides to purchase 5 games and 4 books, his consumption bundle lies _____
a. above his budget line b. below his budget line c. at the intersection of his indifference curve and his budget line d. at the point where his indifference curve is tangent to his budget line