If the Fed sells $100 million of U.S. government securities, what happens to the quantity of money?
What will be an ideal response?
If the Fed sells $100 million of U.S. government securities, the monetary base decreases and, along with it, the quantity of money decreases. The money multiplier shows that the quantity of money decreases by more than $100 million.
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Which of the following is an example of a consumption expenditure?
A) the purchase of a ticket to a New Orleans Saints game B) the salary paid to the mayor of Denver C) the construction of a new public library D) the purchase of a new fire truck
Which of the following is a difference between a second-price sealed-bid auction and an English auction?
A) The highest bidder wins in a second-price sealed-bid auction while the second-highest bidder wins in an English auction. B) The second-highest bidder wins in a second-price sealed-bid auction while the highest bidder wins in an English auction. C) Bids are placed privately in a second-price sealed-bid auction while bids are placed publicly in an English auction. D) Bids are placed one after another in a second-price sealed-bid auction while bids are placed simultaneously in an English auction.
If personal income minus transfer payments is rising, real GDP is most likely
A) rising. B) falling. C) remaining stable. D) getting ready to fall.
Which of the following statements explains the difference between diminishing returns and diseconomies of scale?
A) Diminishing returns are the result of changes in explicit costs. Diseconomies of scale are the result of changes in explicit costs and implicit costs. B) Diminishing returns refer to production while diseconomies of scale refer to costs. C) Diminishing returns cause a firm's marginal cost curve to rise; diseconomies of scale cause a firm's marginal cost curve to fall. D) Diminishing returns apply only to the short run; diseconomies of scale apply only in the long run.