The quantity theory of money assumes that
A) the velocity of money is constant. B) the velocity of money is negative.
C) the velocity of money fluctuates unpredictably. D) the velocity of money is zero.
A
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Conditional input demand curves always slope down, but unconditional input demand curves can slope up.
Answer the following statement true (T) or false (F)
Which of the following is not a criterion for an ideal voting system, according to economist Kenneth Arrow?
A. Unanimity B. No dictator C. Transitivity D. Fairness
Which of the following is true? a. Virtually all theories in economics are expressed using a ceteris paribus ("let everything else be equal" or "holding everything else constant") assumption. b. The fallacy of composition is that, even if something is true for an individual, it is not necessarily true for many individuals as a group. c. One must always be careful not to confuse correlation
with causation. d. All of the above are true.
According to liquidity preference theory,
a. an increase in the interest rate reduces the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the price level shifts money demand to the right. b. an increase in the interest rate increases the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the price level shifts money demand leftward. c. an increase in the price level reduces the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the interest rate shifts money demand rightward. d. an increase in the price level increases the quantity of money demanded. This is shown as a movement along the money-demand curve. An increase in the interest rate shifts money demand leftward.