Assume a money multiplier of 3. If the Treasury finances a $30 million expenditure by selling securities to the Fed, the effect of this transaction on the money supply is that it will
A) remain unchanged.
B) rise by $3 million.
C) rise by $30 million.
D) rise by $90 million.
C
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Along with changes in the level of economic activity, measured by GDP, what other economic variable tends to rise and fall as a consequence?
A. Precipitation B. Regulation C. Circulation D. Unemployment
The government of Poorland increased its expenditure following a recession. This is likely to lead to ________
A) higher interest rates B) an increases in demand for labor C) a decrease in the price level D) lower real wages
The possible double taxation of income is a disadvantage for
A) sole proprietorships and partnerships. B) partnerships and corporations. C) sole proprietorships and corporations D) corporations.
If a good has an income elasticity of 1.83, then it:
A. is a normal good, and a necessity. B. is an inferior good, and a necessity. C. probably has a lot of close substitutes available. D. is a luxury.