The unit of value function of money refers to how we think about and record a transaction, whereas the means of payment function refers to how we actually pay for the items
a. True
b. False
A
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The German government carries out an official foreign exchange intervention in which it uses dollars held in an American bank to buy French currency from its citizens. How is this accounted for in the balance of payments?
A) current account, French good export B) current account, German good import C) financial account, French asset export D) financial account, German asset export E) financial account, German asset import
An example of something that might be sold in the underground economy is:
A. lawn-mowing services. B. endangered animals. C. baby-sitting services. D. All of these could be exchanged in the underground economy.
A reduction in a monopolist's fixed costs would
a. decrease the profit-maximizing price and increase the profit-maximizing quantity produced. b. increase the profit-maximizing price and decrease the profit-maximizing quantity produced. c. not effect the profit-maximizing price or quantity. d. possibly increase, decrease or not effect profit-maximizing price and quantity, depending on the elasticity of demand.
Which of the following statements is TRUE?
A. During periods of inflation, nominal GDP increases more rapidly than does real GDP. B. Real values are expressed in current dollars. C. Increases in real GDP are evidence that the distribution of wealth is becoming more equal. D. Nominal values are expressed in constant dollars.