Why do you hold money? According to the classical economists, the only motivation you have for holding money is for
a. transactions purposes
b. precautionary purposes
c. speculative purposes
d. savings purposes
e. liquidity purposes
A
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If the adoption of a new technology led to gains in productivity ________
A) the ensuing positive supply shock would lead to an immediate increase in output B) in the short-run, the ensuing increase in supply would lower inflation C) and if this new technology permanently altered the productive capacity of the economy then the increase in output and decrease in inflation would be permanent as well D) all of the above E) none of the above
If a firm has market power it may be able
A) to protect market share. B) to continue to earn economic profits. C) minimize marginal costs. D) to maximize total revenue.
If an employer's behavior is supportive of the theory of efficiency wages, the employer would
a. raise wages in an effort to increase worker effort. b. raise wages in an effort to increase worker turnover. c. decrease wages in an effort to increase worker effort. d. decrease wages in an effort to increase worker turnover.
In the above figure, the movement from point C to point A is the result of
A) a decrease in the price of coffee. B) an increase in the price of coffee. C) a decrease in the price of gasoline. D) an increase in the price of gasoline.