Lower real income ________ the demand for money and a lower price level ________ the demand for money.
A. decreases; decreases
B. increases; decreases
C. increases; increases
D. increases; does not change
Answer: A
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Adoption of a currency board
A) is one method for achieving a soft peg policy. B) places responsibility for exchange rate management in the hands of an agency that is independent of political influences. C) mandates the use of currency in all domestic transactions. D) requires that a centralized institution holds interest-bearing assets denominated in the currency against which the nominal exchange rate is being fixed.
The marginal propensity to consume (MPC) is the change in consumption divided by the change in saving
a. True b. False Indicate whether the statement is true or false
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Which of the following statements best describes the domestic beneficiaries of international trade?
a. Over time, the average person gains from international trade as a worker, but not as a consumer. b. Over time, the average person gains from international trade, both as a worker and as a consumer. c. Over time, the average person gains from international trade as a consumer, but not as a worker. d. Over time, the average person does not gain from international trade, either as a worker or as a consumer.