People hold money primarily because it
a. increases in value when there is inflation.
b. serves as a store of value.
c. serves as a medium of exchange.
d. functions as a unit of account.
c
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The financial intermediaries that the average person interacts with most frequently are
A) exchanges. B) over-the-counter markets. C) finance companies. D) banks.
Refer to Figure 13.2. Assume the economy is initially in equilibrium with real GDP equal to potential GDP
Other things equal, if the economy enters a recession and the government underestimates the severity of the recession when implementing fiscal policy, the output gap will ________ and the rate of inflation will ________ than if the government had correctly estimated the recession's severity. A) decrease less; decrease less B) decrease more; decrease more C) decrease more; decrease less D) not change; not change
The income-consumption curve for Dana between Qa and Qb is given as: Qa = Qb. His budget constraint is given as: 120 = Qa + 4Qb How much Qa will Dana consume to maximize utility?
A) 0 B) 24 C) 30 D) 60 E) More information is needed to answer this question.
What are the seven short run cost calculations? How are they related?