If people hold onto some money as cash, rather than depositing it into banks:
A. this will not affect the size of the money multiplier.
B. the money multiplier will be smaller.
C. the money multiplier will be zero.
D. the money multiplier will be larger.
Ans: B. the money multiplier will be smaller.
Economics
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The figure above shows a tax imposed on a good with an external cost. The area of the rectangle abcd equals
A) the MSB. B) the total tax revenue collected by the government. C) the amount of pollution tax per ton. D) the MC. E) the deadweight loss.
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Prior to almost all recessions since 1950, there has been a drop in
A) inflation. B) the money stock. C) the growth rate of the money stock. D) interest rates.
Economics