Refer to the given figure where the nominal interest rate equals 6 percent and the money supply equals 600.
If the Federal Reserve wants to lower the interest rate to 4 percent, it must ________ the money supply to ________.
A. increase; 800
B. decrease; 800
C. decrease; 400
D. increase; 1,000
Answer: A
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
Although foreign exchange market trades are said to involve the buying and selling of currencies, most trades involve the buying and selling of
A) bank deposits denominated in different currencies. B) SDRs. C) gold. D) ECUs.
If consumers purchase more of a good when their income rises, the good is a normal good
a. True b. False Indicate whether the statement is true or false
The nominal rate of interest is 4% and the anticipated rate of inflation is 5%. What is the real rate of interest?
A. 9% B. -1% C. 4% D. 1%