Which of the following is true about M1 and M2?
A. M1 includes currency, but M2 does not.
B. Neither M1 nor M2 includes money market mutual funds.
C. M2 includes saving deposits and money market mutual funds, but M1 does not.
D. M1 and M2 both include checking accounts and savings accounts.
Answer: C. M2 includes saving deposits and money market mutual funds, but M1 does not.
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An example of business fixed investment spending is
A) a purchase of a home by a household. B) a purchase of a bond by General Electric Corporation. C) a purchase of a computer by an accounting firm. D) $200 million of unsold cars at a car dealership.
The change in a firm's total cost from producing one more unit of a good or service is
A) the definition of marginal product B) the result of economies of scale. C) the definition of marginal cost. D) impossible to observe in large firms with many manufacturing plants.