Velocity of money is the ratio of ________
A) real GDP to money demand B) money supply to money demand
C) nominal GDP to money supply D) nominal GDP to money demand
C
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Suppose the Fed increases the money supply. As a result of this, people go out and spend more money on consumer goods, increasing aggregate spending. This is known as a(n)
A) indirect effect of monetary policy. B) direct effect of monetary policy. C) indirect effect of fiscal policy. D) direct effect of fiscal policy.
Firms often seek to borrow money to expand their capital stock, and the price they pay for that money is the interest rate. What happens to the quantity of money supplied if the interest rate increases?
A. It increases. B. It decreases. C. It does not change. D. It depends entirely on the interest rate.
In the United States, most periods of very high inflation occurred
A) during times of war. B) during recessions. C) in the past 25 years. D) before the year 1800.
In which of the following market structures with 2 identical firms do both firms produce more than the Cournot outcome?
A) Stackelberg Oligopoly B) Cartel C) Perfect Competition D) None of the above.