Which of the following is an example of fiat money?
A) a cowry shell used as money on a South Pacific island
B) a gold coin used as money in nineteenth century England
C) a Federal Reserve Note used as money in the twenty-first century United States
D) a pound of salt used as money in medieval France
C
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The Interstate Commerce Commission (ICC) regulates railroads, barges and trucks. Suppose technical change lowers the costs of railroads
As a result, the ICC permits railroads to lower prices some but also alters the rates of barges and trucks so they get additional business. The ICC would be acting consistently with A) the capture theory of regulation. B) the public interest theory of regulation. C) the share-the-gains, share-the-pains theory of regulation. D) None of the theories presented in the text since economic regulation is specific to a single industry and not to agencies that cover more than one industry. That is the province of social regulation.
If the demand increases in a perfectly competitive market, the price will:
A. temporarily decrease. B. increase permanently. C. decrease permanently. D. temporarily increase.
An adverse supply shock causes output to
a. rise. To counter this a central bank would increase the money supply. b. rise. To counter this a central bank would decrease the money supply. c. fall. To counter this a central bank would increase the money supply. d. fall. To counter this a central bank would decrease the money supply.
The accompanying table below shows how total donations, average donations, total labor costs and average labor costs vary depending on the number of employees State U hires for its fundraising activities. Number of EmployeesTotal DonationsAverage DonationsTotal Labor CostsAverage Labor Costs1$30,000 $8,0002$42,426 $17,000 3 $17,321$27,000 4$60,000 $9,5005 $13,416$50,000 The total labor cost with 4 employees is:
A. $21,500. B. $43,121. C. $38,000. D. $22,000.