Under a flexible exchange rate system a decline in the value of a currency relative to other currencies is a called a ________ and under a fixed exchange rate system a decrease in the official value of a currency is called a ________.
A. depreciation; devaluation
B. appreciation; revaluation
C. depreciation; appreciation
D. revaluation; appreciation
Answer: A
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As disposable income ________, planned consumption expenditure ________ by a ________ amount
A) decreases; increases; larger B) increases; decreases; smaller C) increases; increases; larger D) increases; increases; smaller E) decreases; increases; smaller
How do firms in monopolistic competition compete?
What will be an ideal response?
A change in the reserve requirement is the tool used least often by the Fed because it:
A. Does not affect bank reserves. B. Can cause abrupt changes in the money supply. C. Does not affect the money multiplier. D. Has no impact on the lending capacity of the banking system.
Government purchases of goods and services are:
A. Nonexhaustive because they do not directly absorb resources and account for production B. Exhaustive because they directly absorb or employ resources and account for production C. Both exhaustive and nonexhaustive because in some cases they do directly absorb resources or account for production and in other cases they do not D. Neither exhaustive or nonexhaustive because of the tax revenues that finance these purchases