In quantity theory terms, during a hyperinflation,
A) money supply increases rapidly, but velocity does not
B) velocity increases rapidly, but money supply does not
C) both the money supply and velocity increase rapidly
D) neither the money supply nor velocity increase rapidly
C
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Which of the following is an example of a supply shock?
A. A surge in consumer optimism prompts increased buying of goods and services. B. A surprise tax rebate from the government gives people more money to spend. C. A dramatic increase in energy prices increases production costs for firms in the economy. D. Government increases spending on education.
Which of the following statements reflects a situation in which there are external costs?
A. Suzanne pays for a professional fireworks show for her family. Her neighbors also enjoy the show. B. Suzanne dumps her household garbage around the corner of the street. C. Suzanne invites her neighbors to a party on her birthday. D. Suzanne paints her house and landscapes her yard. Her newly beautified house and yard help her neighbors to sell their house for more than the asking price.