In the monetarist transmission mechanism, changes in the money market directly affect aggregate demand
Indicate whether the statement is true or false
True
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Comment on the following statement: "I decided to buy a car from a dealer in a town 100 miles away because he was offering a price that was $100 lower than the dealer in my hometown. Therefore, I saved $100."
What will be an ideal response?
An electric utility is going to use a block-pricing schedule. They plan to charge P1 for the first Q1 units and P2 for the subsequent units. The units sold at P2 are the total units sold, Q2, minus the total units sold at P1
The inverse demand curve is P = $100 - Q, and the marginal and average cost is $40. Use calculus to solve for P1, P2, Q1, Q2.
If the money supply equals 1,000, velocity equals 5, and real GDP equals 2,500, then the price level equals:
A. 5. B. 2. C. 5,000. D. 2.5.
If international capital flows are highly responsive to interest rates, expansionary fiscal policy will
A. lead to current account surpluses. B. lead to financial account deficits. C. be totally ineffective. D. lead to financial account surpluses.