The price index is the index year with a base price other years are compared when constructing an index. The index equals 100
Indicate whether the statement is true or false
false
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What happens to the maximum amount of "all other goods" that this person can buy if instead he receives the $100 in food coupons? What's the maximum amount of food he can buy under this plan?
What will be an ideal response?
The country of Meditor, a small country with a closed economy, uses the merit as its currency. Recent national income statistics showed that it had GDP of $600 million merits, no government transfer payments, taxes of $150 million merits, a budget surplus of $40 billion merits, and investment of $100 billion merits. What were its consumption and government expenditures on goods and services?
a. $460 million merits and $150 million merits b. $310 million merits and $190 million merits c. $350 million merits and $190 million merits d. $390 million merits and $110 million merits
Which of the following is considered a problem with active policy?
a. Estimating the potential output b. Forecasting aggregate demand c. Tools must already be in place to achieve results relatively quickly. d. All of the above are problems with the implementation of active policy
Are outstanding credit card balances counted as part of the money supply?
A. Yes; they are used to purchase things, and therefore, they are included in the money supply figures. B. No; money is an asset, while the credit card balances are a liability. Thus, they are not included in the money supply figures. C. Partly; credit card balances of $100 or less are included in the M1 money supply, but the money supply figures do not include balances in excess of $100. D. Partly; credit card balances are included in the M1 money supply, but not the M2 money supply.