If interest rates increase, the government debt becomes:
A. less expensive to pay.
B. more volatile.
C. less of a burden.
D. more expensive to pay.
Answer: D
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When the central bank sells $1,000,000 worth of government bonds to the public, the money supply:
A. increases by $1,000,000. B. decreases by $1,000,000. C. decreases by more than $1,000,000. D. decreases by less than $1,000,000.
When you pay for items that are consumed immediately or wear out quickly by financing them with your credit card, your wealth
A) decreases. B) is non-taxable. C) expands. D) is saved for future use.
Suppose that Coke and Sprite each sell for $2 a can. Each month Joe buys 6 cans of Sprite and 30 cans of Coke. From this we can infer that:
A. Joe is maximizing his utility if his marginal utility from the 6th can of Sprite he buys is equal to his marginal utility from the 30th can of Coke he buys. B. Joe is buying too many cans of Coke. C. Joe is maximizing his utility if his marginal utility from the 6th can of Sprite he buys is less than his marginal utility from the 30th can of Coke he buys. D. Joe is buying too many cans of Sprite.
Which of the following assets are counted in M2?
A) gold B) balances in retail mutual funds accounts C) value of outstanding bonds D) lines of credit offered by commercial banks