When money is neutral, which of the following increases when the money supply growth rate increases?
a. real output growth
b. real interest rates
c. nominal interest rates
d. the money supply divided by the price level
c
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A relationship that shows the technological possibilities for an economy as a whole is called a
A) production function. B) utility possibilities frontier. C) production possibilities frontier. D) budget constraint.
When a firm's long-run average total costs do not vary as output increases, the firm exhibits
a. economies of scale. b. constant returns to scale. c. diseconomies of scale. d. an efficient use of resources.
The Securities and Exchange Commission and the Federal Aviation Administration are examples of agencies engaged in
A) the regulation of natural monopolies. B) the regulation of nonmonopolistic industries. C) social regulation. D) health and safety regulation.
Markets tend to
A. increase transaction costs. B. make exchange more difficult. C. reduce transaction costs. D. exist primarily in towns or cities.