"The rigid link between monetary growth and inflation . . . had been broken." M1 grew faster in the deflationary 1980s than in the inflationary 1970s. Why?
A) The demand for money increased, reducing spending.
B) The demand for money decreased, due to financial deregulation.
C) The demand for money increased, as did velocity.
D) The demand for money decreased and the Fed targeted the money supply.
B
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Spending on programs that Congress authorizes ________ is known as discretionary spending
A) after approval from the Federal Reserve B) on an off-budget emergency basis C) by prior law D) on an annual basis
A major difference between tax systems in developing and developed country is that
a. developing countries rely on direct taxes, and developed countries rely on indirect taxes b. developing countries rely on indirect taxes and developed countries rely on direct taxes c. developing countries rely on domestic taxes and developed countries rely on taxes on foreign trade d. developing countries rely on ‘forced saving' and developed countries tax saving directly e. there are no significant differences
If the marginal social benefit of consuming a product exceeds the marginal social cost of producing it, social welfare is
a. increased by reducing output b. decreased by expanding output c. unchanged by expanding or reducing output d. increased by expanding output e. maximized
The price-taker firm should discontinue production immediately if:
a. the market price exceeds the firm's average total costs. b. the market price is less than the firm's average variable costs. c. the market price is less than the firm's average total costs, but greater than its average variable cost. d. its accounting statement indicates that it is suffering losses.