If economists say that a 7 percent growth in the money supply will increase aggregate demand by 7 percent, they are assuming that velocity

To determine the change in the capital stock, the level of new investment must be adjusted for depreciation because some new investment

A) is not used immediately. B) replaces existing workers. C) is more efficient than existing capital. D) merely replaces existing, but worn out, capital.

Which of the following statements is true?

A) GDP growth distributes income equally to people in the economy. B) GDP accounting rules do not adjust for production that pollutes the economy. C) A decrease in the crime rate increases GDP as people will spend more on security. D) Household production is counted in GDP as it amounts to real production.