Which one of the following is a function of the Federal Reserve System?
A. providing a system for check clearing
B. serving as a lender of last resort
C. providing the economy with currency
D. all of these
Answer: D
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What are the two types of prices in an economy?
What will be an ideal response?
According to one study, the price elasticity of demand for restaurant meals is -2.27. This implies that if restaurants want to increase their total revenues they should:
A) increase prices. B) decrease prices. C) leave prices unchanged. D) cannot be determined with the information given.
The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
If real GDP grows by 3 percent, the velocity of circulation does not change, and the quantity of money grows by 3 percent, then in the long run the inflation rate is
A) 0 percent. B) 6 percent. C) -3 percent. D) -6 percent. E) 3 percent.