When Kobe puts money under his mattress for purchases later on, money is acting as a
A. unit of accounting.
B. standard of deferred payment.
C. store of value.
D. medium of exchange.
Answer: C
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Your classmates from the University of Chicago are planning to go to Miami for spring break, and you are undecided about whether you should go with them. The round-trip airfares are $600, but you have a frequent-flyer coupon worth $500 that you could use to pay part of the airfare. All other costs for the vacation are exactly $900. The most you would be willing to pay for the trip is $1400. Your only alternative use for your frequent-flyer coupon is for your trip to Atlanta two weeks after the break to attend your sister's graduation, which your parents are forcing you to attend. The Chicago-Atlanta round-trip airfares are $450. If the Chicago-Atlanta round-trip air fare were $350, should you use the coupon to go to Miami?
A. Yes, your economic surplus would be $400. B. Yes, your economic surplus would be $50. C. No, your economic surplus would be ?$100. D. No, your economic surplus would be ?$50.
A permanent increase in autonomous investment causes
A) a less than proportional increase in real Gross Domestic Product (GDP). B) a more than proportional increase in real Gross Domestic Product (GDP). C) an offsetting change in saving that leaves real Gross Domestic Product (GDP) at the same level. D) a proportional increase in real Gross Domestic Product (GDP).
This year Terrance earned $3,000 more than last year. As a result, he received $2,500 less in government transfers. Therefore, Terrance's implicit marginal tax rate is about
a. 16 percent b. 25 percent c. 66 percent d. 83 percent
If reserves increase by $4 million and the required reserve ratio is 8%, what is the resulting change in checkable deposits (or the money supply), assuming that there are no cash leakages and that banks hold zero excess reserves?
A) $3.2 million B) $3.7 million C) $5 million D) $50 million