The velocity of circulation grows at 1 percent and real GDP grows at 3 percent. If the quantity of money grows at 2 percent, the inflation rate is
A) 8 percent. B) 10 percent. C) zero. D) 2 percent. E) 4 percent.
C
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In the above figure, the demand for loanable funds curve is drawn for the average expected profit. If the real interest rate is constant at 6 percent and the expected profit falls, the amount of loanable funds demanded will be
A) less than $450 billion. B) $450 billion. C) between $450 billion and $600 billion. D) greater than $600 billion.
As Goldilocks consumes more gummy bears, her total utility ________ and her marginal utility from gummy bears ________
A) increases; increases B) increases; decreases C) decreases; increases D) decreases; decreases
Some economic historians argue that the Interstate Commerce Commission (ICC) was the first case of the "capture" of a federal regulatory commission. What does this mean?
(a) The railroads used the ICC to solve the problems of cartel management. (b) The users of the railroads—passengers and shippers—influenced the ICC to keep railroad rates high and the quality of those services high. (c) The railroads used the Commission to keep rates high and keep potential new railroads from entering the business. (d) Foreign investors high jacked the ICC to protect their railroad investrments.
United States Government Source of Funds and Outlays, Fiscal 2011
What will be an ideal response?