When the money supply declines by 10%, in the long run, output ________ and the price level ________
A) is unchanged; is unchanged
B) declines; falls
C) is unchanged; falls
D) declines; is unchanged
C
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We calculate the price elasticity of demand as the
A) ratio of the percentage change in the quantity demanded to the percentage change in price. B) change in quantity divided by the change in price. C) ratio of the percentage change in the price to the percentage change in quantity. D) percentage change in the quantity demanded divided by the percentage change in income. E) equilibrium quantity divided by the equilibrium price.
With rent controls set below the equilibrium rent, what mechanism might arise that moves the market closer to the efficient equilibrium?
A) decreased search costs B) black market activity C) increased advertising by landlords D) more favorable leases offered to tenants
Suppose Ford Motor Company issues a 5% bond with a stipulation that if a national index of SUV sales drops by 10%, then Ford can decrease the coupon rate to 3%. This security is called a
A) credit option. B) credit swap. C) credit-linked note. D) credit default swap.
Rivalry among firms would tend to be highest if
a. the industry is growing quickly b. the industry is growing slowly c. the industry is shrinking d. None of the above