A domestic monetary shock is least disruptive
A. under a floating exchange-rate system.
B. under both fixed and floating exchange rates.
C. under a fixed exchange-rate system without sterilization.
D. under a fixed exchange-rate system with sterilization.
Answer: C
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In order for the banking system to expand the money supply with a money multiplier effect, all of the money loaned out
a. has to have been demand deposits at some bank b. has to stay in one bank c. by one bank has to be deposited in the same bank d. has to be repaid before the multiplier process can work e. has to equal the amount of legal reserves for the banking system
Economic thinking suggests that a nation in which middlemen are considered to be unproductive seekers of profit, and where their activities are heavily restricted by law, will
a. gain by channeling people's efforts away from unproductive middleman activity toward physical output. b. lose the potential gains from trade that would result from lower transaction costs emanating from middleman activities. c. find that it is richer because the added transaction costs normally imposed by middlemen will be reduced. d. gain because the value of total output will rise.
Based on the graph showing the supply and demand for health care service, health insurance ______.
a. decreases the demand for health care
b. increases the demand for health care
c. decreases the price for health care
d. increases the efficiency of health care
Refer to Figure 8.4. If three microwave ovens are produced, average variable costs are A) $166.67. B) $333.33. C) $500. D) $1,500.