Refer to Figure 6.1. The monopolist earns a profit equal to 

The reason we are willing to accept money with no intrinsic value is that

A) the money supply is backed by an equal amount of gold and silver. B) we have a fiduciary monetary system in which currency has both acceptability and predictability of value. C) the value of the money varies directly with changes in the price level. D) paper currency may be exchanged for full-bodied money.

When the price level increases people:

A. feel less wealthy. B. feel more wealthy. C. experience a bubble forming in the economy overall. D. have the same real value of assets, regardless of the change in the price level.