When net taxes increase and government purchases decrease, _____
a. the price level will rise
b. money supply must rise
c. the aggregate demand curve shifts leftward
d. output and employment increase
e. the aggregate supply curve shifts leftward
c
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What is the difference between buying stocks and buying bonds?
A) The future growth of a stock is more uncertain than the payments of a bond. B) Differences of opinion about a stock's future may vary considerably but there is less difference about a bond's future. C) A stock can possibly pay dividends forever, but bonds have a fixed number of payments. D) All of these are differences between stocks and bonds.
The exchange rate system followed by the United States is known as
A) the gold standard. B) a fixed exchange rate system. C) a flexible exchange rate system. D) a barter system.
The distribution of income and wealth in colonial America was
(a) relatively equal to that of modern America. (b) relatively unequal to that of modern America. (c) unequal in roughly the same degree as that in modern America. (d) unequal, but the data are not good enough to allow a comparison with modern America.
Write out the equation of exchange. What assumptions did the classical economists make about the variables that compose the equation, and what did this lead them to conclude about money and prices?