Refer to Scenario 10-1. Based on the information above, what is the level of public saving?
A) $0 B) $1 trillion
C) $2 trillion D) negative $1 trillion (a deficit of $1 trillion)
D
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It is difficult for competent authorities to agree on the best definition of the money stock because money is composed primarily of the liquid liabilities of financial institutions
A) and liquidity implies the absence of certainty. B) of which there are many different kinds whose relative liquidity is continually changing. C) on which we simply have no reliable data. D) whose solvency is highly questionable.
The Stogie Shop, a cigar store in the mall, sells hand-rolled cigars for $10.00 and machine-made cigars for $2.50 each. What is the opportunity cost of buying a hand-rolled cigar?
A) $10.00 B) 4 machine-made cigars C) $2.50 D) one-quarter of a machine-made cigar