When Something Happens to the Economy, Monetarists Ask Two Questions

question 74

Multiple Choice

When something happens to the economy, monetarists ask two questions:

• A)What does this do to government spending, and what does it do to tax revenues?
• B)What does this do to real GDP, and what does it do to the price level?
• C)What does this do to investment spending, and what does it do to net exports?
• D)What does this do to the money supply, and what does it do to velocity?

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Definitions:

Registration Statement

A set of documents filed with a regulatory authority for the purpose of registering a new security for sale to the public.

Prospectus

A formal document that companies and investment funds issue to potential investors, detailing important facts about the investment offering.

CFO

The Chief Financial Officer, a senior executive responsible for managing the financial actions of a company.

Bonds

Fixed-income investments representing a loan made by an investor to a borrower, typically corporate or governmental.