Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Computer Engineering Expert

QUESTION 1: According to the quantity theory of money, the quantity of money determines the

a. interest rate.
b. level of real output.
c. price level.
d. level of employment.

QUESTION 2: In the equilibrium version of the classical model, the velocity of money

a. depends on the real rate of interest.
b. depends on the level of employment.
c. is equal to the Cambridge k.
d. is stable in the short run.

QUESTION 3: According to the classical model, a 10-percent increase in the money supply, holding everything else constant, will lead to

a. a 10% increase in prices, a 10% increase in the real wage, and a 10% increase in interest rates.
b. a 10% increase in prices, a 10% increase in the money wage, and a 10% increase in interest rates.
c. a 10% increase in prices, a 10% increase in the money wage, and no change in interest rates.
d. a 10% increase in prices and no change in the money wage or interest rates.
e. none of the above.

QUESTION 4: The classical model predicts that, in the short-run, a tax cut financed by an increase in the money supply would

a. leave output and the price level unchanged.
b. increase the price level but leave output unchanged.
c. increase output but and reduce the price level.
d. increase output and the price level by increasing aggregate demand.
e. None of the above.

QUESTION 5: In the classical model, a rise in the marginal income tax rate would

a. cause the price level to rise and the level of real output to fall.
b. cause the price level and the level of real output to both fall.
c. cause the price level to rise with no effect on real output.
d. leave both real output and the price level unchanged.

QUESTION 6: In the classical model, an exogenous increase in saving is assumed to increase

a. the demand for loanable funds, which decreases interest rates.
b. the supply of loanable funds, which decreases the equilibrium interest rates.
c. both the demand for money and loanable funds, which reduces interest rates.
d. neither the demand for money nor bonds, leaving interest rates unchanged.

QUESTION 7: In the classical model, the level of business investment was a function of

a. only the expected profitability of investment projects.
b. only the real interest rate.
c. both the expected profitability of investment projects and the real interest rate.
d. only the nominal interest rate.
e. None of the above.

QUESTION 8: If the quantity of investment has fallen but interest rates have risen, then

a. this cannot be explained in the classical model.
b. savings fell.
c. savings rose.
d. investment demand rose.

QUESTION 9: Which of the following is (are) correct? In the classical system, the suppliers of bonds were the

a. government which always sold bonds to finance a new project.
b. firms which financed all investment expenditures by selling bonds.
c. government which might sell bonds to finance spending in excess of tax revenues.
d. Both b and c.

QUESTION 10: The difference between savings and investment is that

a. investment is purchasing stock, while savings is putting money in a bank.
b. investment is purchasing capital, savings is postponing consumption.*
c. Investment increases output, while savings decreases output.
d. None of the above.

QUESTION 11: According to the quantity theory, inflation is ultimately controlled by

a. private firms who set prices.
b. the monetary authorities who control the money supply.
c. those who control output.
d. the price of oil.

QUESTION 12: Classical economists

a. argued that the money supply determined aggregate demand.
b. regarded monetary policy as unimportant since the quantity of money does not determine the price level.
c. believed that the quantity of money influences interest rates and real wages.
d. believed that prices would increase more than proportionate to an increase in the money supply.

QUESTION 13: Which of the following statements applies to the classical system?

a. There is money wage inflexibility since full employment already existed
b. A perfectly flexible money wage is not always a requirement for full employment
c. Full employment was easily explained with downward money wage rigidity
d. An imperfect market structure is requirement for full employment
e. none of the above

QUESTION 14: In the classical theory of aggregate demand, a decrease in the propensity to hold money will

a. shift the aggregate demand curve up.
b. Shift the aggregate demand and supply curves up and to the right.
c. have no effect on aggregate demand as the money supply changes.
d. will increase the money supply

QUESTION 15: If there is an increase in government spending that is financed by issuing bonds, then

a. interest rates should rise which increases private investment.
b. interest rates will remain the same unless taxes are reduced as well.
c. interest rates should fall which increases private investment.
d. interest rates should rise which decreases private investment.
e. None of the above.

Computer Engineering, Engineering

  • Category:- Computer Engineering
  • Reference No.:- M91509383
  • Price:- $15

Priced at Now at $15, Verified Solution

Have any Question?


Related Questions in Computer Engineering

Can someone please help in this question - if the the price

Can someone please help in this question - If the the price of a pack of 35-count Wipes box-pack increased by 12% while revenue from those wipes increased by 5%. Calculate the own-price elasticity of demand for Wipes box ...

Strategies when resources are constraineda project manager

Strategies When Resources Are Constrained A project manager has fewer options for accelerating project completion when additional resources are either not available or the budget is severely constrained. This is especial ...

Nfs allows the file system on one linux computer to be

NFS allows the file system on one Linux computer to be accessed over a network connection by another Linux system. Discuss the security vulnerabilities of NFS in networked Linux systems, and possible mitigation solutions ...

Semantic html5an ongoing belief in the web design industry

Semantic HTML5: An ongoing belief in the Web design industry is that HTML5 is critical to Web design for four reasons: Accessibility. Search engine optimization. Faster download speeds. More efficient styling and coding. ...

Are search algorithms tied to data structures being

Are search algorithms tied to data structures being searched, or can they be utilized in other scenarios?

When talking about economics and the history of it for the

When talking about Economics and the history of it. For the past recessions the U.S. has had, do we look at it mostly on the loan side of the banks or what causes most recessions?

Take a tour of your building on campus or at work what is

Take a tour of your building on campus or at work. What is secured at night when workers are absent? Record the location and type of physical access control devices. How do these access controls change at night when work ...

Question what is the smallest value of n such that an

Question : What is the smallest value of n such that an algorithm whose running time is 1000n 2 runs faster than an algorithm whose running time is 4 n & on the same machine? Justify your answer. The response must be typ ...

A bit-comparator is a combinational circuit with 2 inputs a

A Bit-Comparator is a combinational circuit with 2 inputs, A and B, and 3 outputs. L, E and G. Output L is 1 if A Output E is 1 if A = B, otherwise E is 0. Output G is 1 if A > B, otherwise G is 0. Show how the 2x4 decod ...

Storing the integer 5 value in a binary file 00000000

Storing the integer 5 value in a binary file: 00000000 00000000 00000000 00000101, How do you write value5 to this formation 0000101? Storing the integer 5 value in a text file: 00110101, How do you write value5 to 00110 ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As