The goldsmith's ability to create money was based on the fact that:
A. withdrawals of gold tended to exceed deposits of gold.
B. consumers preferred to use gold for transactions.
C. gold receipts were rarely exchanged for gold.
D. the goldsmith was required to keep 100 percent gold reserves.
Answer: C
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Last year a firm made 1,000 units of its product available at a price of $5 per unit. This year the firm will still make 1,000 units available, but only if the price is $7 per unit. What is most likely to have happened?
a. Supply has increased b. Supply has decreased c. Demand has decreased d. Quantity demanded has increased e. Quantity supplied has increased
Monopolistically competitive firms use product differentiation to
A. limit the number of firms in the industry. B. block other firms from entering the industry. C. achieve market power. D. ensure long-run profits.
Consider the two graphs above. Suppose that businesses expect to hire more workers. This would ________ the desired level of the capital stock, as depicted in graph ________
A) increase; B B) increase; A C) decrease; B D) decrease; A
Central banks can increase the money supply by:
a. Increasing the discount rate. b. Buying government securities. c. Selling foreign exchange. d. All of the above. e. None of the above.