The quantity theory of money assumes that
A) the velocity of money is constant. B) the velocity of money is negative.
C) the velocity of money fluctuates unpredictably. D) the velocity of money is zero.
Ques. 2A study conducted by Alberto Alesina and Lawrence Summers concluded that countries with ________ had lower inflation rates than countries with ________.
A) a large government debt; little to no government debt
B) highly independent central banks; central banks that have little independence
C) low rates of unemployment; high rates of unemployment
D) no private banking system; an independent banking system
Ques. 3The Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association were established by Congress in order to regulate banks that buy and sell mortgage-backed securities.
Indicate whether the statement is true or false
Ques. 4A borrower defaults on a loan when he stops making payments on the loan.
Indicate whether the statement is true or false
Ques. 5When exchange rates are ________, we say that the country's exchange rate is fixed.
A) determined in the market B) relatively stable
C) set by a country's central bank D) determined by supply and demand