If a percentage decrease in money supply is followed by a proportional percentage decrease in prices and output, this means that:
a. the velocity of money is constant.
b. the economy is in a recession.
c. the velocity of money has fallen.
d. real GDP is constant.
e. the economy is not at maximum capacity
a
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An appreciation of the British pound relative to the euro will cause England's:
a. Aggregate supply and aggregate demand to rise, which causes prices to rise and real GDP to fall. b. Aggregate supply to rise and aggregate demand to fall, which causes prices to rise and real GDP to fall. c. Aggregate supply to rise and aggregate demand to fall, which causes prices to fall and real GDP to change by an uncertain amount. d. Aggregate supply and aggregate demand to fall, which causes prices to rise and real GDP to fall.
Which of the following is considered to be a tel-tale signal that the point with the highest total utility has been found?
A. the marginal utility per dollar is the same for both goods B. the marginal utility per dollar is controlled by trade-offs C. the demand curves are flatter reducing quantity D. the quantities demanded change so total utility rises
Explain why greater equality is inevitably gained at the expense of efficiency.
What will be an ideal response?
Here are the costs of going to college: tuition $5,000; books $200; housing $1,000; food $1,000; lost income from work $10,000. Studying and work are equally desirable in your mind. Suppose that you could live at home at no cost to you if you worked, but must live on campus if you go to school. What is the total opportunity cost to you of going to school rather than working? (Food costs the same at school or home.)
A. $15,200 B. $7,200 C. $5,200 D. $16,200