If the government finances its spending by issuing debt to the public, the monetary base will ________ and the money supply will ________
A) increase; increase
B) increase; decrease
C) decrease; increase
D) not change; not change
D
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Zara is the largest fashion retailer in Europe. Which of the following would not a barrier to entry that protects Zara's market power?
a. two weeks to develop and deliver a new item, as opposed to an industry average of nine months b. 10,000 new designs a year c. stores can restock in a few days d. little advertising e. new fashions distributed twice a week, as opposed to twice a season
Show, using utility theory, why a consumer who is initially maximizing her utility will alter her consumption pattern in response to a change in the price of a good
Which of the following is most likely to happen if the aggregate demand curve for an economy (which was initially in equilibrium) shifts to the left? a. The equilibrium real GDP will decrease
b. The equilibrium price level in the economy will increase. c. The aggregate supply curve will shift rightward. d. The aggregate supply curve will shift leftward. e. The economy will experience an expansion.
Deflation is
A. a constant rate of inflation. B. a slow-down in the rate of inflation. C. zero inflation. D. a decline in the average price level.