In the new classical model, an anticipated increase in the money stock would cause
a. the price level and level of real output to rise.
b. the price level to rise with no effect on real output.
c. real output to rise with no effect on the price level.
d. no change in the price level or level of real output.
B
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The solvency of Social Security can be extended if
A. the trust fund invests in private corporate securities. B. the tax rate is reduced. C. the retirement age is reduced. D. the cap on taxable earnings is lowered.
The payments in return for labor and capital are _____, respectively.
a. ?profit and rent b. ?rent and wages c. ?interest and profit d. ?wages and interest e. ?profit and wages
Because a price ceiling causes:
A. a shortage, some form of rationing must occur. B. a surplus, some form of rationing must occur. C. a shortage, the outcome will be efficient. D. a surplus, the outcome will be inefficient.
The typical firm in the US economy
a. has some degree of market power. b. sells its product for a price that is equal to the marginal cost of producing the last unit. c. is perfectly competitive. d. is a monopoly.