Suppose that currently the morey supply is $500, nominal GDP is $5,000, and the price level is 2. Ceteris paribus, it followsthat real GDP isand the velocity of money isSelect one:a. $5,000; 10b. $5,000; 20c. $2,500; 10d. $2,500; 20

‘Nominal GDP’ is the market value of goods(G) and services(S) produced in an economy, without…

Answered: Suppose that currently the morey supply…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The figure shows the market for tires. The figure shows that the government has imposed a tax of per tire. Price (dollars per tire) O A. $40 S+ tax 70 В. $60 60 O C. $30 50 +..... O D. $10 hat ma O E. None of the above answers is correct. 40 As 30 20 Ass 10 10 20 30 40 50 60 70 Quantity (millions of tires per month) its AR O Time Remaining: 00:59:31 Next ompleted This course (ECON202 s2022 online) is based on Bade/Parkin: Foundations of Microeconomics, 9e MacBook Pro terwebsite name
Other things the same, continued increases in the money supply lead to a. continued increases in the price level and real GDP. b. continued increases in real GDP but not continued increases in the price level. c. continued increases in the price level but not continued increases in real GDP. d. a one-time permanent increase in both prices and real GDP.
Assume, in the 3rd quarter of 2018 in the U.S., the velocity of money was 3.08 and the M2 money supply was $1,050 million. The average prices in the economy was $1.44. Based on this, what was the real GDP of the U.S. in the 3rd quarter of 2018. O a. $2,750 million O b.$1,250 millon Oc. $2,000 million O d. 52.250 million
An increase in the nominal interest rate would O a. encourage people to hold smaller money balances. O b. encourage people to hold larger money balances. O c. force the Fed to reduce the money supply. d. cause the real interest rate to decline.
5. Assuming that nominal interest rates stay the same, an decrease in the rate of inflation would raise the real interest rate, which would tend to: a. increase or decrease investment spending. b. increase investment spending. c. not affect investment spending d. decrease investment spending.
5
If the quantity of money supplied is greater than the quantity of money demanded, then the a. price level falls. O b. money supply decreases. C. nominal interest rate rises. d. nominal interest rate falls. O e. price of bonds falls.
90 Figure 11-1 of Value of Maney MS1 MS2 lag Meney Dem and 1 C D Quantity of Man ey Refer to the Figure 11-1. What happens when the money supply curve shifts from MS, to MS,? Select one: a. The economy's ability to produce goods and services increases. b. The demand for goods and services decreases. c. The equilibrium value of money increases. d. The equilibrium price level increases. 2.
The change in the velocity of circulation may be occurring because the ________. A. growth rate of the quantity of money is less than the growth rate of nominal GDP B. growth rate of the quantity of money is greater than the growth rate of real GDP C. real interest rate is greater than the nominal interest rate D. growth rate of the quantity of money is greater than the growth rate of nominal GDP
An open market purchases of government bonds by the federal reserve results in ___ in the supply of money and ___ in interest rates. A. An increase/ a decrease B. A decrease / a decrease C. An increase / an increase D A decrease / an increase
If the price level decreases, OA. there is a movement up along a stationary money demand curve. OB. the money demand curve shifts to the right. C. the money demand curve shifts to the left. D. there is a movement down along a stationary money demand curve.
15. Which one is a cost of inflation? A. Shoe-leather costs B. Menu costs C. Tax distortions D. All of the above 16. In the demand for money curve, when interest rates rises ...? A The opportunity cost of holding money increases. B. The opportunity cost of holding money decreases. C. The opportunity cost of holding money remains constant. D. None of the above. 17. To implement a contractionary policy in the economy, the Central Bank can? A. Buy bond in the market. B. Sell bonds in the market C. Do nothing, leave it to the market. D. Increase money supply. 18. To implement an expansionary policy in the economy, the Central Bank can? A. Increase interest rates. B. Sell bonds in the market. C. Leave it to the market. D. Buy bonds in the market.

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Suppose that currently the morey supply is $500, nominal GDP is $5,000, and the price level is 2. Ceteris paribus, it follows that real GDP is and the velocity of money is Select one: a. $5,000; 10 b. $5,000; 20 c. $2,500; 10 d. $2,500; 20