Which of the following statements is true of open-market operations?
a. Open-market operations involve clearing checks
b. Open-market operations involve lending money to member banks.
c. Open-market operations involve accepting deposits from member banks.
d. Open-market operations involve the Fed's purchase and sale of government securities.
e. Open-market operations involve the Fed's purchase and sale of foreign exchange.
d
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In order to change inflationary expectations in 1979, the Fed's monetary policy under Paul Volcker's leadership resulted in ________ and ________
A) steep inflation; low unemployment B) deflation; high unemployment C) disinflation; low unemployment D) disinflation; high unemployment E) steep inflation; high unemployment
Which of the following describes a situation in which demand must be inelastic?
a. The price of pens rises by 10 cents, and quantity of pens demanded falls by 50. b. The price of pens rises by 10 cents, and total revenue rises. c. A 20 percent increase in the price of pens leads to a 20 percent decrease in the quantity of pens demanded. d. Total revenue does not change when the price of pens rises. e. Total revenue decreases when the price of pens rises.
One reason for the short-run aggregate supply curve (SRAS) is: a. a fixed CPI market basket
b. perfect knowledge of workers. c. fixed-wage contracts. d. the upward-sloping production function.
Based on the graph showing equilibrium output and price for a monopolist, profits stop growing when production goes beyond which point?
a. QD
b. Q1
c. Q2
d. QM