The result that the growth rate of output per worker is equal to 1.43 × is ________
A) true of the Solow model only
B) true of both the Solow model and the Romer model
C) true of the Romer model only
D) true under the common-law legal system only
B
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If the government collects taxes to pay for expenditures of an equal amount, bank reserves
A) are unaffected. B) rise by an equal amount. C) rise by a multiple amount. D) fall by an equal amount.
An extreme case where either the quantity demanded (Qd) or supplied (Qs) changes by an infinite amount in response to any change in price is called:
a. perfect elasticity. b. imperfect elasticity. c. strong elasticity. d. weak elasticity.
Suppose you withdraw $1,000 from your checking account. If the reserve requirement is 20 percent, how does this transaction affect the supply of money and the excess reserves of your bank?
a. There is no change in the supply of money; your bank's excess reserves are reduced by $800. b. There is no change in the supply of money; your bank's excess reserves are reduced by $200. c. The money supply increases by $1,000 . and the excess reserves of your bank are reduced by $800. d. The money supply increases by $1,000 . and the excess reserves of your bank are reduced by $200.
Which of the following will increase the velocity of circulation?
A. Interest rates increase. B. The inflation rate decreases. C. Federal banking legislation abolishes credit cards. D. Employers decide to pay employees once a month instead of once a week.