The Baumol-Tobin analysis suggests that an increase in the brokerage fee for buying and selling bonds will cause the demand for money to ________ and the demand for bonds to ________
A) increase; increase
B) increase; decrease
C) decrease; increase
D) decrease; decrease
B
You might also like to view...
The money the North Korean government spent to purchase a closed British brewery was a(n) ________ cost, and the choice to brew beer in this brewery instead of using the resources to feed the people of North Korea is a(n) ________ cost
A) explicit; explicit B) explicit; implicit C) implicit; implicit D) implicit; explicit
Central bank lending to bail out troubled firms is known as ________, while allowing troubled firms to conceal the true value of their assets is called ________
A) crony capitalism; larceny B) liquidity provision; regulatory forbearance C) securitization; nonconventional monetary policy D) subprime lending; regulatory arbitrage
If the economy is in an inflationary boom, the Fed would most likely
a. encourage banks to provide loans by buying government securities. b. encourage banks to provide loans by raising the discount rate. c. encourage banks to provide loans by selling government securities. d. restrict bank lending by selling government securities. e. restrict bank lending by lowering the federal funds rate.
The inability of Congress to pass a stimulus package after September 11, 2001, could be used as an argument for
A. activist fiscal policy. B. activist monetary policy. C. expansionary fiscal policy. D. contractionary monetary policy.