When aggregate output falls, money demand and the interest rate fall
a. true
b. false
Answer: a. true
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A constant-cost industry will have
A) a perfectly elastic long-run supply curve. B) a perfectly inelastic long-run supply curve. C) an upward sloping demand curve in the long run. D) an upward sloping supply curve in the long run.
An undervalued exchange rate is an exchange rate:
A. that equals the number of units of a foreign currency over the number of units of domestic currency. B. that has an officially fixed value greater than its fundamental value. C. that has an officially fixed value less than its fundamental value. D. at which the quantities of currencies demanded and supplied in the foreign exchange market are equal.
Which industry would be considered to be monopolistically competitive?
A. Groceries in a small remote town. B. Locally owned restaurants in large cities. C. Fast food restaurants along rural interstate highways. D. Agriculture products sold at farmers' market.
Federal Reserve Board Chairmen Paul Volcker, as well as later Fed chairs, focused on which of the following as their main goal of monetary policy?
A) high employment B) price stability C) economic growth D) stability of financial markets