A __________ discount rate makes it __________ advantageous to sell securities to obtain additional reserves
A) higher; less
B) lower; more
C) higher; more
D) None of the above.
C
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Before an uneven rise in prices Allan consumed five bread and six juice. After the price increase and with an increased welfare payment from the government Allan consumes four bread and seven juice
Does the government payment represent a true cost-of-living adjustment? A) Yes, if the two consumption bundles lie on the same indifference curve. B) Yes, if the second bundle yields more utility than the first. C) No, the first bundle is clearly preferred. D) Not enough information.
In the long run in monopolistic competition,
a. economic profits are zero. b. P = MC. c. P = minimum ATC. d. firms have an incentive to leave. e. the demand curve is tangent to the MC curve.
The existence of inflation does which of the following?
A) reduces tax distortions B) reduces shoe-leather costs C) allows for the possibility of negative real interest rates D) reduces the costs associated with money illusion
When the AD curve is relatively flat
A. only monetary policy can be used to increase output. B. only fiscal policy can be used to increase output. C. both fiscal policy and monetary policy can be used to increase output. D. neither fiscal policy nor monetary policy can be used to increase output.