Question
Milton Friedman argued for increasing this variable by a fixed amount every year to curb inflation. For 10 points each:
[10m] Name this variable that, along with liquidity preference, names a curve in the IS-LM model. This variable is measured by M1, M2, and M3.
ANSWER: money supply [or supply of money; prompt on money by asking "what particular variable related to money?"; reject "supply"]
[10h] The economic costs of inflation include these ones incurred by firms when they raise their prices. These costs partly explain price stickiness.
ANSWER: menu costs
[10e] Inflation also imposes shoe-leather costs, which arise when agents visit these institutions. "Runs" at these institutions may lead to financial crises when too many people visit them at the same time.
ANSWER: banks
<Social Science - Social Science - Economics>
Data
Summary
| Tournament | Edition | Exact Match? | Heard | PPB | Easy % | Medium % | Hard % |
|---|---|---|---|---|---|---|---|
| 2025 PACE NSC | 06/07/2025 | Y | 42 | 18.10 | 98% | 60% | 24% |