Figure 4-24
Refer to . The amount of the tax on each unit of the good is
a.
P3 - P1.
b.
P3 - P2.
c.
P2 - P1.
d.
Q2 - Q1.
a
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Limited commitment means
A) one cannot credibly promise something. B) one saves only part of what is optimal. C) only some households are allowed to save. D) there is rationing on the credit market.
If the central bank targets the money stock, then a negative shock to money demand will
a. shift the LM schedule to the right and income will rise above the target level. b. shift the LM schedule up and income will fall below the target level. c. not shift the LM schedule and, therefore, will not displace income from the target level. d. None of the above
The South was characterized by all of the following except
(a) large plantations and slave labor. (b) a more unequal distribution of income and wealth than in the North. (c) a lack of public education systems. (d) a strong manufacturing sector.
If a nation is running current account surpluses, then it must be:
a. Financing them with surpluses in the rest of the balance of payments. b. Running deficits in the rest of the balance of payments. c. In good economic health. d. Sliding into a recession. e. Having its central bank intervene in the foreign exchange market to lower the value of the currency.