In the Land of Oz the Monetary Unit Is the Emerald

question 462

Multiple Choice

In the land of Oz the monetary unit is the emerald. Households and firms in Oz currently hold 100,000 emeralds. The price level is 100. If the price level jumps to 110 and other things remain the same, households and firms will _ .

• A) increase the money they hold by 10,000 emeralds
• B) increase the money they hold by 1,000 emeralds
• C) decrease the money they hold by 1,000 emeralds
• D) decrease the money they hold by 10,000 emeralds

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Definitions:

Elements

Fundamental components or basic building blocks that constitute a whole, whether in nature, science, or a structured system.

Corporation

A legal entity that is separate and distinct from its owners, offering limited liability protection and the ability to raise capital through issuing shares.

Partnership

A legally recognized arrangement in which two or more persons co-manage a business and distribute its profits among themselves.

Sole Proprietorship

A business owned and operated by a single individual, with no legal distinction between the owner and the business.