Which of the following equations captures the aggregate capital stock of the economy in this year, Know?
A) Know = (1 - depreciation rate) Klastyear + I B) Know = (1 + depreciation rate) Klastyear + I
C) Know = (1 - depreciation rate) Klastyear I D) Know = (1 - depreciation rate) Klastyear - I
The depreciation rate of capital in an economy is 10. The investment on capital in the current year is 500.
Question 2
________ occurs when the Fed creates a large amount of reserves to buy long-term bonds from banks.
A) Budgetary surplus B) Monetary neutrality
C) Money illusion D) Quantitative easing
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