In the simple liquidity-preference model, the money supply curve is:
A. vertical, and moves when people change their rate of savings.
B. horizontal, and moves at the sole discretion of the Fed.
C. vertical, and moves at the sole discretion of the Fed.
D. horizontal, and moves when people change their rate of savings.
Answer: C
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The opportunity cost of producing a dining room table refers to the
a. quantity of money required to produce the table b. quantity of money required to buy the table c. quantity of other goods that must be given up to produce the table d. quality of the table e. use of lumber to produce the table
Which of the following is a major implication of the invisible hand concept?
A) When directed by competitive market prices, the actions of self-interested individuals will tend to promote overall economic prosperity. B) Prosperity cannot be achieved unless the selfish nature of people can be changed. C) Government-operated firms tend to have lower costs than private sector firms. D) Competition is harmful to the health of an economy because it results in wasteful duplication.
If the cyclically adjusted budget shows a deficit of about $200 billion and the actual budget shows a deficit of about $250 billion over a several-year period, it can be concluded that there is a:
A. contractionary fiscal policy. B. cyclical deficit. C. progressive tax system. D. proportional tax system.
The further in the future a payment is received, the more it is worth today.
Answer the following statement true (T) or false (F)