It is true that inflation is a A) continuous increase in the money supply. B) continuous fall in prices. C) decline in interest rates. D) continually rising price level. ANSWER D
Date: September 10th, 2020
An increase in the riskiness of corporate bonds will ________ the yield on corporate bonds and ________ the yield on Treasury securities, everything else held constant. A) increase; increase B) reduce; reduce C) increase; reduce D) reduce; increase ANSWER C
Date: September 10th, 2020
________ theory relates the quantity of money and monetary policy to changes in aggregate economic activity and inflation. A) Monetary B) Fiscal C) Financial D) Systemic ANSWER A
Date: September 10th, 2020
All else constant, an increase in the incomes of consumers in the market for diamonds would cause the supply of diamonds to increase. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
The estimated regression equation is Y = 10 + 2.5X, if X =0 than the predicted value of Y is equal to: A) 12.5 B) 10 C) 2.5 D) 7.5 ANSWER B
Date: September 10th, 2020
Briefly discuss the relationship between leakages and the size of the multiplier. What will be an ideal response? ANSWER The fewer leakages out of the circular flow will increase the size of the multiplier. Thus, if the marginal propensities to consume and invest increase or the marginal propensity to import decreases, the slope of […]
Date: September 10th, 2020
A decrease in the riskiness of corporate bonds will ________ the price of corporate bonds and ________ the price of Treasury bonds, everything else held constant. A) increase; increase B) reduce; reduce C) reduce; increase D) increase; reduce ANSWER D
Date: September 10th, 2020
Assume that in an effort to help consumers, the government decides to reduce the amount of taxes it imposes on sellers of gasoline, that is, sellers are required to pay the government a smaller fee for each gallon of gas they sell. In the market for gas, this would have the effect of causing an […]
Date: September 10th, 2020
A continuing increase in the growth of the money supply is likely followed by A) a recession. B) a depression. C) an increase in the price level. D) no change in the economy. ANSWER C
Date: September 10th, 2020
In the foreign exchange market, the quantity supplied of dollars is 300 whereas the quantity demanded of dollars is 500 results in a: A) balance of payments surplus of 200. B) balance of payments deficit of 200. C) balance of payments surplus of -200. D) balance of payments deficit of -200. ANSWER A
Date: September 10th, 2020
