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Question 41( ]$ B+ V8 N: X/ }' g6 L. ?
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?
* r% a% Y, q8 L* z6 ^A) Real gross domestic product decreases and the inflation decreases.
$ V5 y9 R6 Z7 {, Q! M% xB) The price level decreases and output remains unchanged.
3 L; z$ O. a4 iC) The rate of money supply growth decreases.
6 F& X2 U6 U: v: ?1 hD) Aggregate demand decreases.
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Question 42; A M" M* `& z( H3 T* v$ q
The velocity of money is the:. `) Z/ L% v) m7 N5 A0 w
A) rate at which the price index for consumer goods rises.9 k' T! B9 t! y$ {
B) output expansion multiple of government expenditures.* P) w1 h7 J! T, R
C) average number of times a dollar is used to purchase goods and services.
3 Q! z: ~. M0 P5 ]1 h0 K! w1 X6 VD) number of times a dollar is taken out of the country during a year.
1 x7 a+ a) O# U5 @ B2 o' p! a 0 Q& `) S0 D7 G3 u
Question 43
# Y6 F+ N! v! _/ g" NThe advantages of a proprietorship are least likely to include:* H' H# |, s- ]1 R
A) ease of formation.! m8 V* @5 }3 ^1 v9 h
B) simple decision making process.3 l4 d% X4 j2 D3 T+ U4 f
C) single taxation of profits.1 H" ^& [: T$ ~
D) limited liability. ) _! n; \' E! E+ D- H
3 [- E9 |/ ]0 e9 w
Question 44
1 X4 |/ [: r) F" ?% V1 CIn theory, the supply of a non-renewable resource is:' C" s- M4 a" J- y* W( p# c
A) fixed over a specific period of time.. Q& V, K( g0 K; @+ H" A' Z! X
B) perfectly inelastic at a price that equals the present value of the expected next-period price.8 ^1 i4 |6 C Y2 d! S
C) perfectly elastic./ {2 w2 q1 T8 r3 v: B
D) perfectly inelastic at the price where demand intersects supply.- m9 u' z7 m6 o2 M3 j4 F6 D
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Question 459 m+ J. |. d( f" i* Q) ]4 D
Demand-pull inflation would least likely be caused by an increase in:" Y0 e+ E/ V5 j
A) the prices of raw materials.4 y) r! k% B! C y4 {
B) the money supply.
" o, ~( N, o3 A6 jC) government purchases.
* c1 L/ R @- s0 t' s0 G4 f) N0 M0 rD) foreign incomes.# C9 E5 Q* z; G$ T* D: H
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