​Which of the Following Statements Is True

question 72

Multiple Choice

​Which of the following statements is true?

• A)​The ATM model of money is a general­equilibrium model.
• B)​The opportunity cost of holding money in the ATM model increases when the nominal interest rate declines.
• C)In a general-equilibrium model, most of the key macroeconomic variables are exogenous.
• D)​​Normally, results from a general equilibrium model can be applied to a wider range of problems than the results from a partial-equilibrium model.

---

Definitions:

Subsidize Tobacco Production

Financial support provided by governments to farmers or companies to assist in the growing or manufacturing of tobacco products.

Global Warming

The long-term rise in Earth's average surface temperature, largely due to human activities that emit greenhouse gases into the atmosphere.

Interest Rate

The percentage at which interest is paid by a borrower for the use of money that they borrow from a lender.

Lower Inflation

A decrease in the rate at which the general level of prices for goods and services is rising.