Which of the following is not an investment?
A. the purchase of a share of stock by a household
B. the purchase of a delivery van by a florist
C. the purchase of a new computer system by a law firm
D. all of the above
Answer: A
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Consumers most likely decide on their current consumption spending by looking at their short-run income prospects.
Answer the following statement true (T) or false (F)
In an economy where aggregate spending is given by Y = 5,500 + 0.6Y - 20,000r, the interest rate is currently 5 percent (0.05). If potential output equals 11,750, the central bank must ________ the interest rate to close the ________ gap.
A. raise; recessionary B. reduce; recessionary C. raise; expansionary D. reduce; expansionary
Suppose the central bank announces that it will pursue a monetary expansion in the current period and a monetary expansion in the future. Explain how the credibility of the central bank might influence the effectiveness of this monetary policy action and announcement of a future monetary policy action
What will be an ideal response?
Which of the following advances contributed to the "new economy" of the mid-1990s?
A) the increased use of the Internet in selling products and services B) the lower cost and increased availability of laptop computers C) expanded cell phone use D) all of the above