According to the text, the main reason for people to hold money is A) because they are irrational. B) to use it for different reasons. C) to tell other people how rich they are. D) to enjoy looking at the pictures of past leaders. ANSWER B
Date: September 2nd, 2020
The aggregate demand curve will shift to the left if A) government expenditures increase. B) people are more optimistic about their future. C) the nation’s exports decrease. D) a reduction in the price level pushes down borrowing costs. ANSWER C
Date: September 2nd, 2020
The relationship between the price level and the real Gross Domestic Product (GDP) without full adjustment or full information is represented by A) the distance between the long-run aggregate supply curve and the short-run aggregate supply curve. B) the short-run aggregate supply curve. C) the long-run aggregate supply curve. D) the aggregate demand curve. […]
Date: September 2nd, 2020
At tax rates higher than the tax rate that maximizes tax revenues along a Laffer curve A) an increase in tax rates increases tax revenues. B) any variation in tax rates has no effect on tax revenues. C) a reduction in tax rates increases tax revenues. D) a reduction in tax rates reduces tax revenues. […]
Date: September 2nd, 2020
When Annie puts her money in her sock drawer for purchases later on, money is acting as a A) unit of accounting. B) standard of deferred payment. C) store of value. D) medium of exchange. ANSWER C
Date: September 2nd, 2020
What is the most common reason people demand money? A) Each bill and coin is a reflection of important people and events in a nation’s history. B) Since very few of us engage in a flow of transactions, money is our financial safety net. C) People desire to use money as a medium of exchange […]
Date: September 2nd, 2020
Refer to the above figure. Line BCD is called A) the consumption function. B) the 45-degree line. C) the savings function. D) the saving function. ANSWER A
Date: September 2nd, 2020
Which of the following statements correctly differentiates between a model and a hypothesis? A) Testing a hypothesis does not require data, whereas testing a model requires data. B) A model is a simplified representation of reality, whereas a hypothesis is a model’s predictions. C) A hypothesis can be used to make predictions for the future, […]
Date: September 2nd, 2020
Which of the following statements about the public debt is TRUE? A) It is equal to the budget deficit. B) It decreases when the government runs a budget deficit. C) It is a stock variable. D) all of the above ANSWER C
Date: September 2nd, 2020
Consider a closed economy without the government. If the savings rate in the economy is 15% and the aggregate savings is $6,000, the GDP of the economy is: A) $15,000. B) $27,000. C) $40,000. D) $30,000. ANSWER C
Date: September 2nd, 2020
