Absent regulation of the money supply, the money supply would likely reflect the business cycle
a. True
b. False
Indicate whether the statement is true or false
True
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If the government uses fiscal policy to close a recessionary gap, government
A) expenditure must be increased by more than the gap because of the government expenditure multiplier. B) taxes must be cut by more than the gap because of the tax multiplier. C) expenditure can be increased by less than the gap because of the government expenditure multiplier. D) taxes can be raised by less than the gap because of the tax multiplier. E) taxes must be raised by more than the gap because of the tax multiplier.
A firm sells 300,000 units per week. It charges $ 35 per unit, the average variable costs are $40, and the average costs are $55 . In the short run, the firm should
a. Shut-down as the firm is making a loss of $15 million per week b. Shut-down as the firm cannot cover the variable costs c. Shut down because the price is lower than average cost d. None of the above
Which of the following referred to derivatives as "financial weapons of mass destruction?"
A) Ben Bernanke B) Barack Obama C) Warren Buffett D) Michael Lewis
Most economists agree that the best rate of inflation for a stable economy would be around:
A. five to six percent. B. zero. C. seven percent. D. two to three percent.