If a bank keeps some of its excess reserves, the money multiplier:
a. increases.
b. stays the same.
c. goes to zero.
d. decreases.
e. increases, then decreases.
d
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If we want to use a measure of inflation that foreshadows price changes before they affect prices at the retail level, we would base our measure of inflation on
A) the household price index. B) the GDP deflator. C) the producer price index. D) the consumer price index.
All of the following are problems associated with commodity money EXCEPT
A) it is a cumbersome form of payments system. B) commodities tend to have little value in and of themselves. C) its value is dependent on its purity. D) costs are incurred in certifying the purity and weight of commodity money.
When a national security crisis forces the government to draft workers, this often results in price increases because the supply curves of most goods shift to the left. The people who suffer the price-increase consequences mostly are
a. those who are drafted b. farm goods suppliers because they have less to supply c. consumers of farm goods because farm goods are basic goods d. the rich because they can afford to pay the higher prices, but they pay substantially more e. the poor because they are priced out of the markets
If the minimum wage were abolished, the employment of unskilled and inexperienced workers would
A. rise. B. fall. C. stay the same.