In a simple economy (without government or foreign trade) where output can be purchased only by consumers or by firms, saving must equal
A) depreciation. B) income. C) consumption. D) investment.
D
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Markets exist
A) because each person specializes in the production of many products. B) because people are self-sufficient. C) as an arrangement where buyers do not interact with sellers. D) so people can buy and sell things.
The experience of the United States and other industrialized countries in the 1930s contradicts the classical view of the labor market where the money wage adjusts quickly to maintain full employment. On this issue
a. the Keynesians agree but the monetarists disagree. b. the monetarists agree but the Keynesians do not agree. c. both the Keynesians and monetarists are in agreement. d. neither the Keynesians nor the monetarists agree.
All other factors being constant, a reduction in price tends to cause which of the following?
A) an increase in supply and an increase in demand B) a reduction in supply and an increase in demand C) an increase in quantity supplied and a reduction in quantity demanded D) a reduction in quantity supplied and an increase in quantity demanded
In recent years, the Federal Reserve has conducted policy by setting a target for
a. bank reserves. b. the monetary growth rate. c. the exchange rate. d. the federal funds rate.