What is fiat money? Why is fiat money important in the United States today?
Fiat (from the Latin for "Let it be done") money is money that is decreed to be acceptable as payment, regardless of whether or not there is backing by gold, silver, or other precious metals. Money in circulation in the United States (and most other modern economies) today is almost entirely fiat money. Fiat money is valuable only because people believe it is exchangeable for goods and services. Fiat money has no intrinsic value.
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
The difference between the salaries paid to movie stars and to actors who play supporting roles is much greater today than it was in the 1930s and 1940s. What factor explains this increase in relative salaries over time?
A) There was no actors' union in the 1930s and 1940s. The rise of strong actors' unions has caused salaries of movies stars to be greater today than in previous years. B) Technological advances in the entertainment industry increase the revenue that successful movies can earn. This has increased the movie studios' willingness to pay high salaries to movie stars. C) The studio system that dominated the industry in the 1930s and 1940s no longer exists. The studio system allowed movie studios to sign actors to long-term contracts that kept salaries down. D) Agents of movies stars are effective in obtaining large salaries for their clients today. Few movie stars had agents to negotiate for them in the 1930s and 1940s.
Refer to Table 20-16. Looking at the table above, real wages ________ from 2014 to 2015, and real wages ________ from 2015 to 2016
A) rose; fell B) fell; fell C) fell; rose D) rose; rose
Economists caution that conventional statistics used to estimate the extent of poverty in the United States fail to account for benefits people receive that, if considered, would reduce the amount of poverty
Which of the following is an example of these benefits? A) The federal minimum wage forces employers to pay workers with low skills an efficiency wage. B) Individuals with low incomes receive non-cash benefits such as free school lunches and food stamps. C) Individuals can use tax credits and the personal exemption to reduce their taxable incomes. This reduces what they owe the government and increases their disposable incomes. D) The federal income tax system is progressive. As a result, the poor have higher after-tax incomes than they would have if the income tax system was proportional or regressive.