Checkable deposit account balances are
A) only a small component of the money supply. B) counted in the calculation of the money supply.
C) part of M2 but not part of M1. D) considered credit, but not money.
B
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Banks responded to disintermediation by
A) supporting the elimination of interest rate regulations, enabling them to better compete for funds. B) opposing the elimination of interest rate regulations, as this would increase their cost of funds. C) demanding that interest rate regulations be imposed on money market mutual funds. D) supporting the elimination of interest rate regulations, as this would reduce their cost of funds.
The exclusive rights of ownership that allow the use, transfer, and exchange of property are called
A) common property rights. B) private property rights. C) externalities. D) social benefits.
Suppose that production for good X is characterized by the following production function, Q = K0.5L0.5, where K is the fixed input in the short run. If the per-unit rental rate of capital, r, is $25 and the per-unit wage, w, is $15, then the average variable cost of using 81 units of capital and 9 units of labor is:
A. $80. B. $75. C. $5. D. There is insufficient information to determine the average variable costs.
When comparing the Keynesian approach and the monetarist approach, the only substantive difference is that
A. the Keynesian equation leads to a prediction of real GDP, while the monetarist equation leads to a prediction of nominal GDP. B. Keynesians concentrate on aggregate demand and monetarists concentrate on aggregate supply. C. Keynesians approach aggregate demand by multiplying the money supply by velocity, while monetarists use the equilibrium conditions of the expenditure schedule. D. Keynesian analysis suggests that money affects consumption first, while monetarist analysis suggests that money affects investment spending first.