29. Measured inequality overstates actual inequality because _____, meaning cons
ID: 1125429 • Letter: 2
Question
29. Measured inequality overstates actual inequality because _____, meaning consumption inequality is ____.
a. poverty levels vary across states; greater than income inequality.
b. homeless people are not always counted; a poor indicator of lifetime income.
c. different households are in different stages in the life cycle; a better measure of economic well-being than income inequality.
d. people tend to overstate their incomes; the same as income inequality.
1. Banks and other financial/monetary institutions perform which of the following functions?
a. Create liquidity.
b. Lower borrowing costs.
c. Pool risks.
d. All of the above answers are correct.
30. The US Central Bank provides services to
a. individuals and controls the quantity of money.
b. the government and manages the stock market.
c. foreign corporations and determines the exchange rate.
d. banks, and occasionally non-banks, and regulates financial institutions and markets.
31. The Fed policy tools include all the following EXCEPT
a. open market operations.
b. taxes on bank accounts.
c. discount rate.
d. required reserve ratio.
32. Which policy tool does the Fed often use to change the quantity of money in the economy?
a. Open market operations.
b. The discount rate.
c. The required reserve ratio.
d. The federal funds rate.
33. During an inflationary gap,
a. real GDP is less than potential GDP.
b. aggregate demand and aggregate supply intersect at potential GDP.
c. aggregate demand and aggregate supply do not intersect.
d. aggregate demand and aggregate supply intersect at the level of real GDP that exceeds potential GDP.
34. The aggregate demand curve slope downward because of
a. a negative correlation between the price level and the aggregate quantity of goods and services demanded.
b. the effects of wealth, interest rate, and foreign trade.
c. a change in the aggregate quantity of goods and services demanded.
d. None of the above answers are correct.
35. The long-run aggregate supply (LRAS) equals potential GDP when
a. the labor market is in equilibrium.
b. the labor market has zero unemployment.
c. the labor market is unable to create jobs.
d. the labor market is controlled by the government.
Explanation / Answer
Answer.)
Q29.) c. different households are in different stages in the life cycle; a better measure of economic well-being than income inequality.
Q1.) d. All of the above answers are correct.
Q30.) d. banks, and occasionally non-banks, and regulates financial institutions and markets.
Q31.) b. taxes on bank accounts.
Q32.) a. Open market operations.
Q33.) d. aggregate demand and aggregate supply intersect at the level of real GDP that exceeds potential GDP.
Q34,) b. the effects of wealth, interest rate, and foreign trade.
Q35.) a. the labor market is in equilibrium.
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