The purchase and sale of government securities by the Fed is called ________.
A. money market transactions
B. federal funds market
C. open market operations
D. term auction facility
Answer: C
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Economic policy of the government is often based on
A) microeconomic models. B) educated guessing. C) intuitive reasoning. D) hints.
Which of the following is not an example of Joel Waldfogel's "Tyranny of the Market"?
a. A daily newspaper tailored to appeal to the majority of readers in an area. b. Nike creating specialized shoes for American Indians' wider feet. c. Pharmaceutical companies spending research and development funds on drugs for common diseases. d. Airlines offering daily direct flights from one large city to another.
Other things the same, during recessions taxes tend to
a. rise. The rise in taxes stimulates aggregate demand. b. rise. The rise in taxes contracts aggregate demand. c. fall. The fall in taxes stimulates aggregate demand. d. fall. The fall in taxes contracts aggregate demand.
Assume that consumption in the United States is $9,000 billion in 2009. If the MPC is 0.8 and disposable income increases by $1,000 billion in 2010, then the level of consumption in 2010 will be
A. $10,000 billion. B. $9,800 billion. C. $9,000 billion. D. $7,200 billion.