The saying "Money is a veil.". means that
a. while nominal variables are the first thing we may observe about an economy, what's important are the real variables and the forces that determine them.
b. money is the principal medium of exchange in most economies.
c. the primary determinant of short-run economic fluctuations is not real variables, but rather changes in the money supply.
d. in the long run money is of no importance to the determination of either real or nominal variables.
a
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A debt contract is incentive compatible
A) if the borrower has the incentive to behave in the way that the lender expects and desires, since doing otherwise jeopardizes the borrower's net worth in the business. B) if the borrower's net worth is sufficiently low so that the lender's risk of moral hazard is significantly reduced. C) if the debt contract is treated like an equity. D) if the lender has the incentive to behave in the way that the borrower expects and desires.
Other things the same, when an economy increases its saving rate
a. consumption and production rise now. b. consumption rises now and production rises later c. consumption falls now and production rises later. d. consumption falls now and production falls later.