When the interest rate rises
A) planned investment falls.
B) planned investment rises.
C) planned investment will be unaffected.
D) equilibrium income increases.
A
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The purchase of government bonds by the Fed leads to a(n)
A) increase in the demand of bonds and a decrease in the price of bonds. B) increase in the supply of bonds and a decrease in bond prices. C) decrease in the demand of bonds and an increase in the price of bonds. D) decrease in the supply of bonds and an increase in bond prices.
A government policy that prevents the price of a good or service from falling below a specified level is called a price floor and usually results in
A. a shortage. B. a surplus. C. a black market. D. fewer producers of the good or service. E. a decrease in demand.
The ceteris paribus assumption is important in economics because
A) all empirical data are equal. B) it would be impossible to relate the effects of changes in one variable on another without holding some variables constant. C) economic data move very slowly over time and so they can always be considered constant. D) models are always complex and require as many variables as possible.
The international equilibrium price is the point at which:
a. the domestic supply curve of one country intersects the domestic demand curve of another. b. the domestic demand and supply curves of a country intersects each other. c. the export supply curve of one country intersects the import demand curve of another. d. the domestic demand of the trading partners become identical. e. the domestic supply of the trading partners become identical.