In the money market, if the money supply decreases, the opportunity cost of holding money _____
Fill in the blank(s) with the appropriate word(s).
increases and the quantity of money demanded falls.
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The unemployment rate is the:
A. percentage of the labor force that is out of work. B. percentage of the population that is out of work. C. number of workers unemployed. D. number of workers in the labor force.
Which of the following is an appropriate discretionary fiscal policy if equilibrium real GDP falls below potential real GDP?
A) an increase in the supply of money B) an increase in individual income taxes C) a decrease in transfer payments D) an increase in government purchases
Credit cards are a popular means of payment. Why are credit card accounts not included in M1 or M2? Are credit cards of no relevance to these money measures?
What will be an ideal response?
More risk-averse people will:
a. hold fewer risky assets because marginal utility is rapidly diminishing. b. hold fewer risky assets because marginal utility is greater. c. hold fewer risky assets because rates of return are more uncertain. d. hold fewer risky assets because marginal utility is negative.