If velocity and the money supply are __________________, then when one component of spending rises another component of spending ________________
A) constant; must fall
B) constant; must rise
C) rising; may not necessarily fall
D) rising; must rise
C
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How should a natural monopoly be regulated under the social interest theory of regulation?
A) by setting price equal to the average cost of production B) by allowing a price that maximizes the profit of the natural monopoly C) by using a marginal cost pricing rule D) by subsidizing other producers to compete with the monopoly E) by using rate of return regulation
Government savings, , is equal to
A) T - G. B) T + G. C) T = G. D) T + G - I. E) T - G = I.
Rachel agrees to lend Phoebe $100 for six months and charges her interest of 2 percent. At the end of the six-month period, prices have risen by 4 percent
a. Purchasing power has been redistributed to Rachel. b. No purchasing power has been redistributed. c. Purchasing power has been redistributed to Phoebe. d. Both Rachel and Phoebe received extra purchasing power.
What is the Stolper-Samuelson theorem? What are the underlying conditions and assumptions for the theorem
What will be an ideal response?