When the Federal Reserve conducts open market transactions, it
A) buys or sells corporate bonds in the bond market.
B) issues government bonds to raise funds for the government.
C) makes credit available to financial institutions in crises
D) buys or sells previously issued government bonds.
Ans: D) buys or sells previously issued government bonds.
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If there is initially an
A) excess demand for money, the interest rate will fall, and the supply of money it will rise. B) excess supply of money, the interest rate will fall, and if there is initially an excess demand, it will rise. C) excess supply of money, the interest rate will rise, and if there is initially an excess demand, it will fall. D) excess supply of money, the interest rate will fall, and if there is also an excess demand, it will fall rapidly. E) excess supply of money, the interest rate will rise, and if there is also an excess demand, it will rise rapidly.
High rates of saving and investing in the private sector promote economic growth by:
A. increasing human capital. B. improving technology. C. improving the social and legal environment. D. increasing physical capital.
Why would the establishment of protective trade barriers be a poor way of protecting workers in domestic industries?
What will be an ideal response?
The theory of bounded rationality suggests that as price rises:
A. marginal utility will decline. B. MU/P may not decline. C. MU/P will always decline. D. the opportunity cost of the good will decline.