Which of the following "backs" the value of money in the United States?
A. The gold stored in the Federal Reserve Bank of New York
B. The acceptability of it as a medium of exchange
C. The willingness of foreign government to hold U.S. dollars
D. The size of the budget surplus in the U.S. government
B. The acceptability of it as a medium of exchange
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If the MPC = .80, and investment rises from $100 to $150, real GDP will increase by:
a. $50. b. $125. c. $20. d. $250. e. $200.
Crowding out refers to the effect that:
A. C and I are indirectly affected by changes in G. B. C is directly affected by changes in G. C. C and I are directly affected by changes in G. D. C and I are completely unrelated to changes in G.