Typically, when someone borrows money from a bank, M2 ________, because ________
A) increases; the money is held for a while in a liquid form
B) decreases; the money is held for a while in a liquid form
C) does not change; the loan affects only the subcategories within M2
D) decreases; of the decline in the bank's vault cash
E) none of the above
A
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Statements that make value judgments are:
A) pecuniary. B) positive. C) nominal. D) normative.
Suppose a perfectly competitive constant-cost industry is in long-run equilibrium when market demand suddenly falls. What happens to the industry in the long run?
a. It experiences no change form the original equilibrium b. It experiences a higher equilibrium price and produces more output c. It experiences a lower equilibrium price but produces more output d. It experiences the same equilibrium price but produces more output e. It experiences the same equilibrium price but produces less output