Which of the following is a positive economic statement?
a. A tax on butter will reduce the quantity of butter sold.
b. The rich do not pay enough in taxes.
c. People in poor countries should not work for less than $5 per hour.
d. All of the above are positive economic statements.
a. A tax on butter will reduce the quantity of butter sold.
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The long-run money demand curve shows
A) that the value of money influences the quantity of money that households and firms plan to hold. B) how the Fed determines the appropriate interest rate. C) the relationship between real GDP and money demand. D) that the value of money is directly related to the quantity of money demanded. E) the relationship between potential GDP and money demand.
How would you define convergence?
A) tendency for gaps between industrial countries' per-capital incomes to narrow B) tendency for gaps between all countries' per-capital incomes to narrow C) the theory that a crisis in a low-income country will spread to all countries, regardless of debt structure D) the theory that a crisis in a low-income country will spread to only those countries which had lent money to the original country E) tendency for the world distribution of income to be persistently unequal