Every time a new bank loan is made, M1 and M2 increase, demand deposits increase, and bank assets increase
a. true
b. false
Ans: a. true
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GDP in an economy is $11,050 billion. Consumer expenditures are $7,735 billion, government purchases are $1,989 billion, and gross investment is $1,410 billion. Net exports must be ________.
A. $53 billion B. ? $161 billion C. ? $84 billion D. ? $47 billion
Based on historical data, which of the following tended to be most variable over time?
A) real investment spending B) the average propensity to consume C) real consumption spending D) real saving
If MPC = 0.8, a $200 billion increase in government purchases would have what size effect on the "first round" of induced added consumption, and what total effect on AD?
a. increase "first round" consumption by $80 billion; increase AD by $400 billion b. increase "first round" consumption by $160 billion; increase AD by $1 trillion c. increase "first round" consumption by $200 billion; increase AD by $1 trillion d. increase "first round" consumption by $800 billion; increase AD by $4 trillion
In symbols, the equation of exchange says
A) MP = QV. B) MQ = PV. C) MV = PQ. D) MP = MQ.