A system in which the value of currency issued by the government is based entirely on public faith that the currency will be acceptable in trade is
A) a fiduciary system.
B) a private property system.
C) a Gresham system.
D) a socialistic system.
A
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Cost-push inflation happens when technological innovation unexpectedly lowers the cost of production, causing increased demand for goods and services
a. True b. False Indicate whether the statement is true or false
The more price elastic the demand curve, the less quantity demanded will fall when a per-unit tax is imposed
Indicate whether the statement is true or false
Suppose that the EPA has proposed strict controls on the amount of sulfur that diesel fuel contains. These controls were designed to fully offset the cost of pollution generated by diesel fuel vehicles. The effect of the regulation is estimated to increase the equilibrium price of a gallon of diesel fuel by 10 cents. Suppose that demand for diesel fuel is perfectly inelastic and supply has a positive slope. The effect of the regulation will ________ than if demand were not perfectly inelastic.
A. increase price and quantity by more B. increase price by more and reduce quantity by less C. decrease price and quantity by more D. increase price by less and reduce quantity by more
The marginal propensity to consume (MPC) can best be defined as the fraction of
A. real disposable income that is consumed. B. real disposable income that is not consumed. C. a change in real disposable income that is saved. D. a change in real disposable income that is spent.