One potential problem with having private currencies-such as "Bank of Sam" dollars and "Bank of Fred" dollars-is that it will be difficult for individuals to
A. compare Sam dollars to Fred dollars.
B. keep both Sam dollars and Fred dollars in their wallets.
C. discourage both Sam and Fred from inflating their currencies.
D. trade Sam dollars for Fred dollars.
Answer: A
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Suppose that the equilibrium nominal interest rate is 5 percent and the equilibrium quantity of money is $1 trillion. At any interest rate below 5 percent,
A) the supply of money will decrease. B) there will be a surplus of money and bond prices will increase. C) the interest rate will fall and bond prices will fall. D) there will be a surplus of money and bond prices will fall. E) the interest rate will rise and bond prices will fall.
Which of the following types of economic regulation is most likely to encourage a natural monopoly to NOT inflate its costs?
A) average cost pricing rule B) rate of return regulation C) price cap regulation D) None of the above encourages cost cutting.
Which of the following formulas is not correct?
a. ATC = AVC + (TFC/Q) b. TVC = TC/Q c. TC = TFC + TVC d. AFC = TFC/Q e. TVC = AVC ? Q
Bob deposits $100 in a bank account that pays an annual interest rate of 5 percent. A year later, Bob withdraws his $105 . If inflation was 5 percent during the year the money was deposited, then Bob's purchasing power has not changed
a. True b. False Indicate whether the statement is true or false