What was the least important method of financing World War II?
a. Tax revenues
b. Borrowing from the public
c. Creating new money
d. Using the draft for military purposes
c. Creating new money
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The money supply will not increase if you deposit $100 given to you on your birthday in your bank account, and the bank holds all $100 of that money as excess reserves
a. True b. False Indicate whether the statement is true or false
Karl Marx believed that inevitably there would be a clash between ____________ and _____________, leading to an overthrow of capitalism.
Fill in the blank(s) with the appropriate word(s).
The domestic real interest rate (r) for a given country must be the same as the world real interest rate (rw) ________
A) if perfect capital mobility is assumed B) because with no barriers to capital flows, if rw > r domestic residents would just borrow abroad putting upward pressures on the domestic rate until both rates equal each other C) because with no barriers to capital flows, if rw < r domestic residents would only lend to foreigners putting downward pressures on the domestic rate until both rates equal each other D) all of the above E) none of the above
In a certain economy, when income is $100, consumer spending is $60 . The value of the multiplier for this economy is 4 . It follows that, when income is $101, consumer spending is
a. $60.25. b. $60.75. c. $61.33. d. $64.00.