Monetarist and Keynesian theories of money demand differs in that
a. Monetarists assumes that the demand for money is highly inelastic while Keynes assumes money demand is elastic.
b. Monetarists assumes that the money demand function is highly stable while Keynes assumes it is unstable.
c. Monetarists assumes that there is only a transactions demand for money while Keynes also considers the precautionary and speculative demands for money.
d. Monetarists assume that the proportion of income held in theform of money is constant while Keynes believes it varies.
e. all of the above.
E
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If the United States sells beef to Japan, the U.S. beef producer is paid with
A) dollars. B) yen, the Japanese currency. C) international monetary credits. D) euros, or any other third currency.
Increased liquidity in recent decades has reduced interest rates on which of the following assets (holding constant all other things that affect interest rates)?
A) U.S. government bonds B) bonds issued by large corporations C) business loans D) bonds issued by state governments
You have made an investment of $250 that will yield a profit of $30 in one year. If the interest rate is 11.5% is this a good investment?
A. Yes, because the internal rate of return is greater than the interest rate B. Yes, because the interest rate is greater than the internal rate of return C. No, because the internal rate of return is greater than the interest rate D. No, because the interest rate is greater than the internal rate of return
Answer the following questions true (T) or false (F)
1. In a free market there are virtually no restrictions, or at best few restrictions, on how factors of production can be employed. 2. Crude oil is not an example of a factor of production, but when crude oil is processed into gasoline, it is a factor of production. 3. Each person goes about her daily business seeking to maximize her own self interests. In doing so, she contributes to the welfare of society at large. This is the idea underlying Adam Smith's "invisible hand."