Corey visits a computer store. After Alicia shows him several laptop models, Corey picks one out and gives Alicia $1,200 to pay for it. Which function of money does this best illustrate?
a. medium of exchange
b. store of value
c. means of deferred payment
d. unit of account
a. medium of exchange
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An increase in a small open economy's government budget deficit that reduces national saving and the current account balance causes an
A) increase in desired saving. B) increase in the world real interest rate. C) increase in exports. D) increase in absorption.
Unlike oligopoly, other market structures are such that
a. profits are usually low or nonexistent b. firms in those structures need not observe each other to make price and production decisions c. collusion within the structures is easy to accomplish because firms try to avoid competition d. prices tend toward a stable equilibrium e. there are more firms in every other structure
The original goal of the Fed's founders was to prevent the
a. supply of money from increasing too rapidly. b. supply of money from decreasing during downturns. c. possibility of hyperinflation. d. possibility of interest rates falling too rapidly.
In Figure 1.6, at which of the following points would the opportunity cost of producing one more car be the lowest?
A. D. B. C. C. B. D. F.