1. Deflating a nominal quantity is the process of dividing a ____ quantity by a ______ in order to express the quantity in ______ terms.
- real; price index; nominal
- nominal; price index; real
- nominal; nominal quantity; real
- nominal; real quantity; nominal
- real; nominal quantity; real
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Other questions in this quiz
2. Banks hold reserves:
- to meet depositor withdrawals and payments
- to earn interest
- to increase profits
- to escape the double coincidence of wants
- only because the government requires them to hold reserves.
3. If the actual reserve/deposit ratio equals 8% and the desired reserve/deposit ratio for this bank is 10%, the bank should:
- stop making loans.
- make more loans in order to earn interest.
- send the extra reserves to the central bank.
- do nothing because this is a profitable situation.
- request that customers withdraw deposits from the bank.
4. A situation of negative inflation is called:
5. If consumption increases by €9 when after-tax disposable income increases by €10, the marginal propensity to consume equals: