The best argument against monetarists' arguments that steady money growth would prevent fluctuations in inflation and unemployment is that:
a. the government has best control over fiscal policy and should focus on that.
b. large fluctuations in the money supply cannot occur because the supply of money is limited.
c. steady money growth does not necessarily mean steady aggregate demand if velocity is not stable.
d. steady growth in the money supply percents fluctuations in output only if aggregate prices are constant.
C
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Farmers can use their land to grow soy beans or corn. If the price of corn rises,
A) the supply of soybeans decreases and the soybean supply curve shifts leftward. B) the supply of soybeans increases. C) the supply of corn increases and the corn supply curve shifts rightward. D) the supply of corn increases.
As the price of an item goes up, the quantity demanded
A. rises. B. falls. C. remains the same.
Refer to the above graph of the representative firm in monopolistic competition. Excess capacity for this firm would be calculated by:
A. E - C. B. D - 0. C. E - D. D. D - C.
If the government imposes a maximum price in a market that is below the equilibrium price:
A. total surplus in the market increases. B. total surplus in the market decreases. C. total surplus in the market does not change. D. total surplus may increase or decrease, depending on whether costs are increasing or decreasing in production.