All other things unchanged, why does an increase in money demand cause the aggregate demand curve will shift to the left?
A) Because the resulting increase in bond prices reduces consumption spending.
B) Because the resulting decrease in bond interest rate will lead to an increase in the quantity of
investment and net exports.
C) Because the resulting higher interest rate will lead to a lower quantity of investment and net exports.
D) Because the resulting lower interest rate will lead to lower net exports.
Ans: C) Because the resulting higher interest rate will lead to a lower quantity of investment and net exports.
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In a particular year, if the real GDP of Country Y is $400,000 and the nominal GDP of Country Y is $450,000, the GDP deflator is ________
A) 115 B) 112.5 C) 102 D) 0.17
One problem with fiat money, as compared to commodity money, is that: a. more resources are used to create fiat money
b. there is frequently too little fiat money available. c. there is a greater potential for inflation with fiat money. d. fiat money must be turned in to the government to receive the commodity on which it is based. e. fiat money is less divisible than commodity money.