As of 2013, the outstanding U.S. currency is more than $1 trillion, which suggests that the typical U.S. citizen holds $3,600 in cash. Is this an accurate inference? Why?
A) Yes; because dividing total currency by total U.S. population roughly works out to $3,600 per person.
B) No; because criminals and foreigners hold large sums of dollars, so the average citizen holds far less.
C) No; because the average citizen probably does not have $3,600 in her checking account.
D) Yes; because the Fed rarely makes accounting mistakes when computing M1.
E) none of the above
B
You might also like to view...
Aggregate demand ________ and shifts the AD curve ________ when ________
A) increases; rightward; government expenditure increases B) increases; leftward; government expenditure increases C) decreases; leftward; foreign income increases D) increases; rightward; future expected profit decreases E) increases; rightward; taxes increase
When a consumer is at his or her best affordable point, the budget line
A) is flatter than the highest attainable indifference curve. B) is tangent to the highest attainable indifference curve. C) is steeper than the highest attainable indifference curve. D) does not touch the highest attainable indifference curve.
If actual inflation differs from expected inflation, what is the slope of the Phillips curve?
A. The slope is horizontal in the short and long run. B. The slope is upward sloping in the short run and vertical in the long run. C. The slope is vertical in the short run and upward sloping in the long run. D. The slope is downward sloping in the short run and vertical in the long run.
If the expected uncovered interest differential is ________, then the expected overall return favors uncovered investing in the foreign-denominated currency.
A. unchanged B. positive C. negative D. zero