Answer the following statement(s) true (T) or false (F)
1.If the Fed pursues a expansionary monetary policy on the open market, then U.S. exports will most likely decrease.
2.With the velocity of money, V represents the average number of times that each dollar is used in purchasing final goods or services in a one-year period.
3.According to the equation of exchange, the value of goods purchased is more than the value of goods sold.
4.The quantity theory of money and prices is the hypothesis that changes in the money supply lead to equal proportional changes in the price level.
5.The time lag is typically longer for adopting monetary policy changes than fiscal policy changes.
1.false
2.true
3.false
4.true
5.false
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A free market is a market:
A) that has price controls imposed by a ruling authority. B) where almost all exchanges take place involuntarily. C) where determination of equilibrium quantity is free from the forces of demand and supply. D) that operates with little or no government control.
Induced expenditure includes
A) consumption expenditure, government expenditure on goods and services, and imports. B) investment, consumption expenditures, and exports. C) consumption expenditure and exports. D) consumption expenditure and government expenditure on goods and services. E) consumption expenditure and imports.