Demand deposits are termed so because:
A) depositors can withdraw money from such deposits at any point of time.
B) there are no limitations on the amount of money that can be deposited into such accounts.
C) depositors can demand any rate of interest on such deposits.
D) most consumers want to open such accounts as they are greatly in demand.
A
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Which of the following is most likely to lead to an inward shift of the aggregate demand curve?
a. A decrease in the prices of raw materials b. A decline in foreign price levels c. A decline in the domestic price level d. An optimistic expectation about the economy's performance in the near future e. A decrease in foreign income
In order to simplify the equation for the multiplier to its familiar, relatively simple form, we make use of the
a. assumption that increases in government purchases have no effect on consumer spending. b. assumption that the feedback effects associated with changes in government purchases become negligible after two or three rounds of spending have occurred. c. empirical evidence that points to a value of about 3/4 for the MPC. d. fact that the multiplier effect is represented by an infinite geometric series.