The quantity equation states that the
A) money supply times the velocity of money equals the price level times real output.
B) money supply times the price level equals real output divided by the velocity of money.
C) money supply divided by the velocity of money equals the price level divided by real output.
D) money supply times the price level equals real output times the velocity of money.
A
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If an economy's investment outlook improves, leading to increased borrowing to finance new building projects, what is likely to happen to interest rates?
a) Interest rates will fall to 0%. b) Interest rates will fall. c) Interest rates will rise. d) Interest rates will stay the same.
Two goods are considered substitutes only if
a. a decrease in the demand for one leads to a decrease in the supply of the other b. an increase in the demand for one leads to a decrease in the supply of the other c. an increase in the price of one leads to an increase in the demand for the other d. a decrease in the price of one leads to an increase in the demand for the other e. a decrease in the supply of one leads producers to switch to production of the other