Does inherited wealth make the distribution of income less equal or more equal?
What will be an ideal response?
An inheritance from older to a younger generations can only increase wealth and can never decreases wealth within a family, which helps make the distribution of wealth more unequal over time, all else equal. However if a generation is "lucky" and earns a high income and then passes some of it along as an inheritance to more typical less lucky lower-income generations, then inherited wealth makes the distribution of income more equal.
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Other things being equal, appreciation of the dollar
A) increases aggregate demand in the United States, and may decrease aggregate supply by reducing the prices of imported resources. B) increases aggregate demand in the United States, and may increase aggregate supply by reducing the prices of imported resources. C) decreases aggregate demand in the United States, and may decrease aggregate supply by increasing the prices of imported resources. D) decreases aggregate demand in the United States, and may increase aggregate supply by reducing the prices of imported resources.
If the Fed injects reserves into the banking system and they are held as excess reserves, then the money supply
A) increases by only the initial increase in reserves. B) increases by only one-half the initial increase in reserves. C) increases by a multiple of the initial increase in reserves. D) does not change.