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Question 412 R8 a$ R' Y# |: u! S2 o& g' R2 R6 j
An economy in long-run equilibrium experiences a cost-push inflation shock. If a feedback rule monetary policy that focuses on the price level is in place, which of the following effects of the monetary policy change is least likely?2 f0 D; y8 W, }6 B- w# M+ N
A) Real gross domestic product decreases and the inflation decreases.* y: |& ~3 b0 @; }$ ~
B) The price level decreases and output remains unchanged.+ \% b0 A. {) @) s: e6 U/ d. G; b
C) The rate of money supply growth decreases.. V1 C9 O% U7 g: C# I* z x
D) Aggregate demand decreases. 5 H, k% T& I2 K% I/ t- F
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Question 42
5 }% R9 O3 Y3 L, A) HThe velocity of money is the:5 r' [( t8 C) Y- v* |
A) rate at which the price index for consumer goods rises.
$ c; K9 i" K% c( F; tB) output expansion multiple of government expenditures.4 l0 r$ r9 a9 @2 w/ M/ L
C) average number of times a dollar is used to purchase goods and services.
! T! U: b3 @% ~/ LD) number of times a dollar is taken out of the country during a year.7 ]2 D- q* Q( N: O6 v* B" k4 @4 L0 M
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Question 43
# R3 D x6 ?8 Z. zThe advantages of a proprietorship are least likely to include:
& Y- w- C$ ~# u3 b" l$ W( u; BA) ease of formation.. f9 |- |. w$ N$ S3 ]. |" }
B) simple decision making process.
1 a( Z, @. n8 a+ r7 `5 NC) single taxation of profits.+ R, I4 s& K+ C( `7 @; M. ?
D) limited liability. ' D. n4 z' B) @( f3 m3 m, w z
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Question 449 {; ~3 |) _0 `' [# n4 u+ i9 y
In theory, the supply of a non-renewable resource is:
! u& P7 |, r9 w4 F! R2 y, DA) fixed over a specific period of time.
! q G) P1 n' j$ {' ]B) perfectly inelastic at a price that equals the present value of the expected next-period price.& a: Y( t" e9 ?
C) perfectly elastic.3 y6 P1 T1 c q
D) perfectly inelastic at the price where demand intersects supply.9 Z* g U7 U3 A, v) f
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Question 45
( a! D8 n3 T' LDemand-pull inflation would least likely be caused by an increase in:
1 _; j9 }9 F n" d( v- `5 p, _A) the prices of raw materials.
! F. l0 O& u7 L9 H7 Z; {* G! zB) the money supply." {! t3 u7 h& y3 U
C) government purchases.- R0 T% n* h4 e6 w" F$ z
D) foreign incomes.7 d3 _0 ]& g! j
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