By designating Federal Reserve currency as legal tender, the federal government
A) has ensured that Federal Reserve currency will serve as money.
B) has guaranteed that Federal Reserve currency may be exchanged for an equivalent amount of gold or silver.
C) has mandated that Federal Reserve currency be accepted for payment of debts.
D) has mandated that Federal Reserve currency be accepted by citizens of foreign countries in exchange for their countries' currencies.
C
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Suppose Canada has a population of 30 million people and a labor force participation rate of 2/3. Furthermore, suppose the natural rate of unemployment in Canada is 7%. If the current number of unemployed people is 2 million people, what can we conclude about Canada's economy?
A. There is no frictional unemployment present in the economy. B. The unemployment rate is above the natural rate of unemployment. C. The unemployment rate is below the natural rate of unemployment. D. There is no cyclical unemployment present in the economy.
If the price of one input changes, generally the firm will change its use of both inputs.
Answer the following statement true (T) or false (F)
Quotas are a greater threat to competition than tariffs because
A. Tariffs do not reduce the quantity sold and quotas do. B. Quotas preclude additional imports at any price. C. Quotas allow imports but only at a higher price. D. Tariffs are voluntary and quotas are not.
Say the economy is at its potential income at $8 trillion and the deficit is $200 billion. The structural deficit:
A. is $200 billion. B. could be more than $200 billion. C. could be less than $200 billion. D. cannot be determined from the given information.