The supply of money in the economy.

Question

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Answer 1

Question

Chapter 29, Problem 1CQQ

To determine

The supply of money in the economy.

Expert Solution & Answer

Answer to Problem 1CQQ

Option 'c' is the correct answer.

Explanation of Solution

Any commodity or item that a community accepts as payment for the goods and services is known as money. It can be any commodity that the consumer gives in exchange for goods and services. The banks are financial institutions that play an important role in a financial market.

Option (c):

The use of the lines of credit which are accessible with credit card cannot be considered as money supply because it is a debt instrument and there is no supply of money. Therefore, the lines of credit accessed through credit card are not included in the money supply. Thus, option 'c' is correct.

Option (a):

The metal coins are a form of money that is used by an economy for the purpose of the exchange of goods and services. They are accepted as payment for the goods and services. Hence, they are included in the money supply. Thus, option 'a' is incorrect.

Option (b):

Paper currency is a widely accepted form of money all over the world. Hence, it is included in the money supply of the economy. Thus, option 'b' is incorrect.

Option (d):

Bank balances that are accessible with debit cards are the savings of the customers and they are included in the money supply of the economy. When the bank balance increases, the money supply increases, and vice versa. Thus, option 'd' is incorrect.

Economics Concept Introduction

Concept introduction:

Money: Money is any item that is accepted as payment for the goods and services provided by an economy.

Banks: Banks are financial institutions that accept deposits of money from the general public and use it to provide loans to the public.

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Problem 3 You are given the following demand for European luxury automobiles: Q=1,000 P-0.5.2/1.6 where P-Price of European luxury cars PA = Price of American luxury cars P, Price of Japanese luxury cars I= Annual income of car buyers Assume that each of the coefficients is statistically significant (i.e., that they passed the t-test). On the basis of the information given, answer the following questions 1. Comment on the degree of substitutability between European and American luxury cars and between European and Japanese luxury cars. Explain some possible reasons for the results in the equation. 2. Comment on the coefficient for the income variable. Is this result what you would expect? Explain. 3. Comment on the coefficient of the European car price variable. Is that what you would expect? Explain.

Problem 2: A manufacturer of computer workstations gathered average monthly sales figures from its 56 branch offices and dealerships across the country and estimated the following demand for its product: Q=+15,000-2.80P+150A+0.3P+0.35Pm+0.2Pc (5,234) (1.29) (175) (0.12) (0.17) (0.13) R²=0.68 SER 786 F=21.25 The variables and their assumed values are P = Price of basic model = 7,000 Q==Quantity A = Advertising expenditures (in thousands) = 52 P = Average price of a personal computer = 4,000 P. Average price of a minicomputer = 15,000 Pe Average price of a leading competitor's workstation = 8,000 1. Compute the elasticities for each variable. On this basis, discuss the relative impact that each variable has on the demand. What implications do these results have for the firm's marketing and pricing policies? 2. Conduct a t-test for the statistical significance of each variable. In each case, state whether a one-tail or two-tail test is required. What difference, if any, does it make to…

Answer 2

Question

Chapter 29, Problem 1CQQ

To determine

The supply of money in the economy.

Expert Solution & Answer

Answer to Problem 1CQQ

Option 'c' is the correct answer.

Explanation of Solution

Any commodity or item that a community accepts as payment for the goods and services is known as money. It can be any commodity that the consumer gives in exchange for goods and services. The banks are financial institutions that play an important role in a financial market.

Option (c):

The use of the lines of credit which are accessible with credit card cannot be considered as money supply because it is a debt instrument and there is no supply of money. Therefore, the lines of credit accessed through credit card are not included in the money supply. Thus, option 'c' is correct.

Option (a):

The metal coins are a form of money that is used by an economy for the purpose of the exchange of goods and services. They are accepted as payment for the goods and services. Hence, they are included in the money supply. Thus, option 'a' is incorrect.

Option (b):

Paper currency is a widely accepted form of money all over the world. Hence, it is included in the money supply of the economy. Thus, option 'b' is incorrect.

Option (d):

Bank balances that are accessible with debit cards are the savings of the customers and they are included in the money supply of the economy. When the bank balance increases, the money supply increases, and vice versa. Thus, option 'd' is incorrect.

Economics Concept Introduction

Concept introduction:

Money: Money is any item that is accepted as payment for the goods and services provided by an economy.

Banks: Banks are financial institutions that accept deposits of money from the general public and use it to provide loans to the public.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 29, Problem 1CQQ

To determine

The supply of money in the economy.

Expert Solution & Answer

Answer to Problem 1CQQ

Option 'c' is the correct answer.

Explanation of Solution

Any commodity or item that a community accepts as payment for the goods and services is known as money. It can be any commodity that the consumer gives in exchange for goods and services. The banks are financial institutions that play an important role in a financial market.

Option (c):

The use of the lines of credit which are accessible with credit card cannot be considered as money supply because it is a debt instrument and there is no supply of money. Therefore, the lines of credit accessed through credit card are not included in the money supply. Thus, option 'c' is correct.

Option (a):

The metal coins are a form of money that is used by an economy for the purpose of the exchange of goods and services. They are accepted as payment for the goods and services. Hence, they are included in the money supply. Thus, option 'a' is incorrect.

Option (b):

Paper currency is a widely accepted form of money all over the world. Hence, it is included in the money supply of the economy. Thus, option 'b' is incorrect.

Option (d):

Bank balances that are accessible with debit cards are the savings of the customers and they are included in the money supply of the economy. When the bank balance increases, the money supply increases, and vice versa. Thus, option 'd' is incorrect.

Economics Concept Introduction

Concept introduction:

Money: Money is any item that is accepted as payment for the goods and services provided by an economy.

Banks: Banks are financial institutions that accept deposits of money from the general public and use it to provide loans to the public.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 29, Problem 1CQQ

To determine

The supply of money in the economy.

Expert Solution & Answer

Answer to Problem 1CQQ

Option 'c' is the correct answer.

Explanation of Solution

Any commodity or item that a community accepts as payment for the goods and services is known as money. It can be any commodity that the consumer gives in exchange for goods and services. The banks are financial institutions that play an important role in a financial market.

Option (c):

The use of the lines of credit which are accessible with credit card cannot be considered as money supply because it is a debt instrument and there is no supply of money. Therefore, the lines of credit accessed through credit card are not included in the money supply. Thus, option 'c' is correct.

Option (a):

The metal coins are a form of money that is used by an economy for the purpose of the exchange of goods and services. They are accepted as payment for the goods and services. Hence, they are included in the money supply. Thus, option 'a' is incorrect.

Option (b):

Paper currency is a widely accepted form of money all over the world. Hence, it is included in the money supply of the economy. Thus, option 'b' is incorrect.

Option (d):

Bank balances that are accessible with debit cards are the savings of the customers and they are included in the money supply of the economy. When the bank balance increases, the money supply increases, and vice versa. Thus, option 'd' is incorrect.

Economics Concept Introduction

Concept introduction:

Money: Money is any item that is accepted as payment for the goods and services provided by an economy.

Banks: Banks are financial institutions that accept deposits of money from the general public and use it to provide loans to the public.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 29, Problem 1CQQ

To determine

The supply of money in the economy.

Expert Solution & Answer

Answer to Problem 1CQQ

Option 'c' is the correct answer.

Explanation of Solution

Any commodity or item that a community accepts as payment for the goods and services is known as money. It can be any commodity that the consumer gives in exchange for goods and services. The banks are financial institutions that play an important role in a financial market.

Option (c):

The use of the lines of credit which are accessible with credit card cannot be considered as money supply because it is a debt instrument and there is no supply of money. Therefore, the lines of credit accessed through credit card are not included in the money supply. Thus, option 'c' is correct.

Option (a):

The metal coins are a form of money that is used by an economy for the purpose of the exchange of goods and services. They are accepted as payment for the goods and services. Hence, they are included in the money supply. Thus, option 'a' is incorrect.

Option (b):

Paper currency is a widely accepted form of money all over the world. Hence, it is included in the money supply of the economy. Thus, option 'b' is incorrect.

Option (d):

Bank balances that are accessible with debit cards are the savings of the customers and they are included in the money supply of the economy. When the bank balance increases, the money supply increases, and vice versa. Thus, option 'd' is incorrect.

Economics Concept Introduction

Concept introduction:

Money: Money is any item that is accepted as payment for the goods and services provided by an economy.

Banks: Banks are financial institutions that accept deposits of money from the general public and use it to provide loans to the public.

Answer 6

Chapter 29, Problem 1CQQ

To determine

The supply of money in the economy.

Expert Solution & Answer

Answer to Problem 1CQQ

Option 'c' is the correct answer.

Explanation of Solution

Any commodity or item that a community accepts as payment for the goods and services is known as money. It can be any commodity that the consumer gives in exchange for goods and services. The banks are financial institutions that play an important role in a financial market.

Option (c):

The use of the lines of credit which are accessible with credit card cannot be considered as money supply because it is a debt instrument and there is no supply of money. Therefore, the lines of credit accessed through credit card are not included in the money supply. Thus, option 'c' is correct.

Option (a):

The metal coins are a form of money that is used by an economy for the purpose of the exchange of goods and services. They are accepted as payment for the goods and services. Hence, they are included in the money supply. Thus, option 'a' is incorrect.

Option (b):

Paper currency is a widely accepted form of money all over the world. Hence, it is included in the money supply of the economy. Thus, option 'b' is incorrect.

Option (d):

Bank balances that are accessible with debit cards are the savings of the customers and they are included in the money supply of the economy. When the bank balance increases, the money supply increases, and vice versa. Thus, option 'd' is incorrect.

Economics Concept Introduction

Concept introduction:

Money: Money is any item that is accepted as payment for the goods and services provided by an economy.

Banks: Banks are financial institutions that accept deposits of money from the general public and use it to provide loans to the public.

Answer 7

Chapter 29, Problem 1CQQ

To determine

The supply of money in the economy.

Answer 8

Expert Solution & Answer

Answer to Problem 1CQQ

Option 'c' is the correct answer.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Explanation of Solution

Any commodity or item that a community accepts as payment for the goods and services is known as money. It can be any commodity that the consumer gives in exchange for goods and services. The banks are financial institutions that play an important role in a financial market.

Option (c):

The use of the lines of credit which are accessible with credit card cannot be considered as money supply because it is a debt instrument and there is no supply of money. Therefore, the lines of credit accessed through credit card are not included in the money supply. Thus, option 'c' is correct.

Option (a):

The metal coins are a form of money that is used by an economy for the purpose of the exchange of goods and services. They are accepted as payment for the goods and services. Hence, they are included in the money supply. Thus, option 'a' is incorrect.

Option (b):

Paper currency is a widely accepted form of money all over the world. Hence, it is included in the money supply of the economy. Thus, option 'b' is incorrect.

Option (d):

Bank balances that are accessible with debit cards are the savings of the customers and they are included in the money supply of the economy. When the bank balance increases, the money supply increases, and vice versa. Thus, option 'd' is incorrect.