In a period of hyperinflation, the velocity of circulation increases because
A) the real interest rate rises.
B) households and firms spend money as soon as they receive payment.
C) the nominal interest rate decreases.
D) money is valuable everyone wants it.
E) potential GDP increases.
B
You might also like to view...
If your cumulative Grade Point Average (GPA) after two years of college is 3.0, and your grades for the current semester average 3.5, what will happen to your cumulative GPA? Explain the similarity of this example to the case of marginal cost and average cost.
What will be an ideal response?
Under the gold standard
A) a perpetual surplus is possible. B) a perpetual deficit is possible. C) a perpetual surplus is impossible, but a perpetual deficit is possible. D) a perpetual deficit is impossible, but a perpetual surplus is possible. E) a perpetual surplus is impossible.
One piece of evidence that possibly supports the bounded-rationality assumption of behavioral economics is that experiments appear to have shown that
A. total utility is declining when marginal utility is negative. B. people make the same decisions in calm situations than in situations in which emotions come into play. C. people make different decisions in calm situations than in situations in which emotions come into play. D. total utility is maximized when marginal utility is equal to zero.
Refer to the above figure. If the marginal cost curve for pollution abatement shifts to the right, everything considered, the
A) degree of air quality or cleanliness will also decrease. B) the degree of air quality or cleanliness will stay unchanged. C) the degree of air quality will improve. D) the marginal cost of pollution abatement has nothing to do with air quality.