Questions from General Economics

Q: If nominal GDP is $400, real GDP is $200

If nominal GDP is $400, real GDP is $200, and the money supply is $100, then a. the price level is ½, and velocity is 2. b. the price level is ½, and velocity is 4. c. the price level is 2, and veloci...

Q: According to the quantity theory of money, which variable in the

According to the quantity theory of money, which variable in the quantity equation is most stable over long periods of time? a. money b. velocity c. price level d. output

Q: Explain why majority rule respects the preferences of the median voter rather

Explain why majority rule respects the preferences of the median voter rather than the average voter.

Q: Hyperinflations occur when the government runs a large budget _________, which the

Hyperinflations occur when the government runs a large budget _________, which the central bank finances with a substantial monetary _________. a. deficit, contraction b. deficit, expansion c. surplus...

Q: According to the quantity theory of money and the Fisher effect,

According to the quantity theory of money and the Fisher effect, if the central bank increases the rate of money growth, a. inflation and the nominal interest rate both increase. b. inflation and the...

Q: If an economy always has inflation of 10 percent per year,

If an economy always has inflation of 10 percent per year, which of the following costs of inflation will it NOT suffer? a. shoeleather costs from reduced holdings of money b. menu costs from more fre...

Q: A can of soda costs $0.75 in the United

A can of soda costs $0.75 in the United States and 12 pesos in Mexico. What is the peso-dollar exchange rate if purchasing-power parity holds? If a monetary expansion caused all prices in Mexico to do...

Q: Explain the relationship among saving, investment, and net capital outflow

Explain the relationship among saving, investment, and net capital outflow.

Q: Describe the economic logic behind the theory of purchasing-power parity

Describe the economic logic behind the theory of purchasing-power parity.

Q: Comparing the U.S. economy today to that of 1950

Comparing the U.S. economy today to that of 1950, one finds that today, as a percentage of GDP, a. exports and imports are both higher. b. exports and imports are both lower. c. exports are higher, an...