According to purchasing-power parity, if two countries have the same price level because they have the same prices for all goods and services, then which of the following would equal 1?
a. the real exchange rate, but not the nominal exchange rate
b. the nominal exchange rate, but not the real exchange rate
c. the real exchange rate and the nominal exchange rate
d. neither the real exchange rate nor the nominal exchange rate
c
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Suppose the equilibrium rent in Denver is $1,050. A rent ceiling of $755 per month leads to
A) a surplus of apartments in Denver. B) a shortage of apartments in Denver. C) no change in the Denver apartment market. D) fair prices in the Denver market. E) compared to the situation at the equilibrium rent, a decrease in the quantity of apartments demanded and an increase in the quantity of apartments supplied.
Everything else held constant, an increase in the money market fund ratio will mean ________ in the M2 money multiplier and ________ in the M2 money supply
A) an increase; an increase B) an increase; a decrease C) a decrease; an increase D) a decrease; a decrease
Which of the following about fiscal policy is true?
a. The expansionary fiscal policy of the 1980s stimulated aggregate demand and led to high rates of inflation during the latter half of the decade. b. The restrictive fiscal policy of the 1990s led to sluggish economic growth during the decade. c. Even though fiscal policy was highly expansionary during the 1980s, the inflation rate fell and remained at relatively low levels. d. Even though fiscal policy was restrictive during the 1990s, the real growth rate of the economy was strong. e. Both c and d are true.
Sometimes, the taxes with the smallest excess burden are
A. progressive. B. regressive. C. proportional. D. digressive.