The transactions demand for money
A. is determined by the Federal Reserve System.
B. is a function of nominal Gross Domestic Product (GDP).
C. varies directly with the rate of interest.
D. varies inversely with the precautionary demand for money.
Answer: B
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According to the text application, the IPCC estimates that
a. Africa is the only continent vulnerable to climate change b. ecological risk to North America will vary within the region c. Europe should experience shorter growing seasons d. Latin American should experience higher crop yields e. all of the above
Human capital can be increased through
A) investment in new technology. B) decreases in population. C) investment in new machinery. D) education, on-the-job training, and work experience. E) increasing the nation's production of consumption goods.
Proponents of cuts in income tax rates argue that when income tax rates are cut, workers have an incentive to increase their work hours. This argument is based on the assumption that
A) workers are irrational. B) workers make decisions based on the marginal benefit of each hour worked compared to the marginal cost of work. C) the opportunity cost of working is negative. D) the marginal cost of each additional work hour is not important to most workers. E) workers make decisions based on the social interest.
Refer to Figure 28-9. Fed Chairman Paul Volcker's response to high inflation of the late 1970s is depicted in the figure above as a movement from
A) A to D to C. B) A to B to C. C) C to E to B. D) C to D to A. E) C to B to A.