When the Fed prints and issues bills, it creates:
A. a financial liability for the holder of the IOU.
B. a real asset.
C. a financial asset for itself.
D. money.
Answer: D
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Which of the following explains why pork-barrel spending is often approved, even when the spending is inefficient?
a. Each representative has little incentive to oppose pork-barrel spending since the tax savings would accrue to taxpayers throughout the nation. b. General opposition to pork-barrel spending by a legislator would make it more difficult for the legislator to arrange for pork-barrel projects that provide concentrated benefits for his district. c. Logrolling increases the likelihood that pork-barrel projects will be approved. d. All of the above are correct.
On a graph showing the influence of automatic stabilizers on the economy, government expenditures on transfer payments and real GDP have a(n):
A. direct relationship as shown by an upward-sloping line G. B. direct relationship as shown by a downward-sloping line G. C. inverse relationship as shown by an upward-sloping line G. D. inverse relationship as shown by a downward-sloping line G.
Refer to the information provided in Figure 4.6 below to answer the question(s) that follow.Equilibrium in this market occurs at the intersection of curves S and D.
Figure 4.6Refer to Figure 4.6. Consumer surplus is area [A + B + E] if price is
A. P1. B. P2. C. P3. D. above P3.
The marginal utility of leisure time appears to:
A. Be the same even for people with widely different incomes B. Be exempt from the law of diminishing marginal utility C. Increase as the quantity of available leisure time decreases D. Equal zero for successful business executives