Which of the following is an example of a positive, as opposed to normative, statement?
a. The federal government should decrease coverage of unemployment benefits to stimulate the economy out of the recession.
b. Congress should agree on lower government spending for the next fiscal year.
c. The Federal Reserve Bank should increase interest rates in response to the higher-than-expected inflation in the economy.
d. The unemployment rate last year was lower than any other year in the last century.
d
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The wealth effect is another term for the
A) the interest rate effect. B) the real-balance effect. C) substitution effect. D) the indirect effect.
If Joe withdraws a $100 bill from his checking account and Jack deposits another $100 bill in his savings account, by how will M1 and M2 change?
A) M1 will decrease, but M2 will remain the same. B) M1 will increase, and M2 will increase. C) M2 will decrease by $100. D) Both M1 and M2 will remain the same. E) M1 will remain the same, and M2 will increase.
Explain the "vicious-circle-of-poverty" hypothesis
What will be an ideal response?
A U.S. grocery store chain bought $800,000 worth of Kenyan currency from a bank in Kenya. It then used these funds to buy $800,000 worth of coffee from Kenyan coffee growers. As a result of this exchange, by how much and in which direction did: A. U.S. net exports change? B. U.S. net capital outflow change?