Velocity will be constant if the demand for money with respect to the interest rate is
A. elastic, but not perfectly elastic.
B. perfectly elastic.
C. perfectly inelastic.
D. unitary elastic.
Answer: C
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In the market for used cars
A) the market is efficient because the cars are bought by the people who value them the most. B) the market is inefficient because lemons drive out the high quality cars. C) no cars are sold, because people don't like buying lemons. D) Not enough information to determine.
Senior citizens can buy movie tickets at a lower price than the general public. This is an example of
A) age discrimination. B) demand discrimination. C) price discrimination. D) price differentiation.
The primary criticism by Keynesians of the credibility argument for rules is that
A. rules that reduce presidential and congressional influence over monetary policy could ultimately be harmful to the economy. B. the cost of losing flexibility over policy choices may exceed the cost of gaining credibility. C. reputations are a less costly method of maintaining credibility. D. reputations are a less costly method of gaining credibility.
The theory of _______ holds that people will use all information available to them to form the most accurate possible expectations about the future.
a. adaptive expectations b. rational expectations c. Keynesian economics d. Neoclassical economics