Which of the following statements is true?
A) Savings deposits are a part of M2, but not M1.
B) M1 is sometimes referred to as the "broad definition of the money supply".
C) Time deposits are a part of M1, but not M2.
D) M1 is a larger dollar amount than M2.
A
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The presence of a positive externality in a market leads to ________
A) an underproduction of the good B) an overproduction of the good C) a deadweight loss D) a fall in the consumer surplus
In the above figure, CBL is the cost of breaking the law. If it is illegal to buy and sell, then the quantity of the good bought and sold will be
A) 100. B) 200. C) 300. D) 400.
The excess of the nominal interest rate over the TIPS interest rate is known as the
A) interest-rate differential. B) break-even inflation rate. C) yield spread. D) term structure.
Assume that black beans and rice are staples in the diet of one particular family. How could you tell if these goods were complements, substitutes, or unrelated goods?
a. If the price of black beans rose and the consumption of rice remained the same, they would be substitutes. b. If the price of black beans rose and the consumption of rice increased, they would be substitutes. c. If the price of black beans rose and the consumption of rice decreased, they would be substitutes. d. If the price of black beans rose and the consumption of both goods remained the same, they would be complements. e. There is no way to determine whether these goods are complements, substitutes, or unrelated goods.