An essential function of a central bank is to:
A. manage the money supply.
B. collect taxes.
C. issue debt.
D. control and monitor government budgets.
A. manage the money supply.
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
If insured drivers decide to drive more recklessly than uninsured drivers do, then an adverse selection has occurred
Indicate whether the statement is true or false
The term "business cycle" refers to ________
A) the opening and eventual closing down of businesses B) the rising and later declining of the purchasing power of the dollar C) the acquiring of raw materials and ultimate selling of a finished product D) the tendency for rich economies to be inevitably out-paced by other economies E) the slowing and eventual accelerating of economic growth
Which of the following is correct?
a. Once adjustment is made for inflation, the prices of most natural resources have been about steady or falling. b. Technological progress has allowed us to substitute renewable resources for some nonrenewable resources. c. Technological progress has made once-crucial natural resources less necessary. d. All of the above are correct.