What do most economists think is the most accurate statement about velocity?
A. Velocity is fairly constant in the short run but varies considerably in the long run, complicating predictions about nominal GDP.
B. M1 velocity is more stable in the short run than M2 velocity, and it has been a superior tool in predicting changes in nominal GDP.
C. Velocity is not constant in the short run, and predictions about nominal GDP have not fared well.
D. M2 velocity has been less stable than M1 velocity, but both are reliable enough to make accurate predictions about changes in nominal GDP.
Answer: C
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Which of the following accept deposits from or sell shares to the general public?
i. money market funds ii. thrift institutions iii. commercial banks A) i only B) ii only C) iii only D) Both ii and iii E) i, ii, and iii
An increase in taxes on labor income shifts the labor supply curve ________, and the ________
A) leftward; after-tax wage rate falls B) rightward; before-tax wage rate rises C) leftward; before-tax wage rate does not change D) leftward; after-tax wage rate rises E) leftward; after-tax wage rate does not change