If the Federal Reserve Banks goal was to use open market operations to contract the economy it could move from:
A. MS4 to MS3
B. MS2 to MS3
C. MS1 to MS3
D. MS3 to MS4
Answer: A
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A decrease in the supply of dollars on the foreign exchange market, all else equal, will result in:
A) appreciation of the U.S. dollar and depreciation of the foreign currency. B) appreciation of the U.S. dollar and appreciation of the foreign currency. C) depreciation of the U.S. dollar and depreciation of the foreign currency. D) depreciation of the U.S. dollar and appreciation of the foreign currency.
A farmer is deciding whether or not to add fertilizer to his or her crops. If the farmer adds 1 pound of fertilizer per acre, the value of the resulting crops rises from $80 to $100 per acre. According to marginal analysis, the farmer should add fertilizer if it costs less than:
a. $12.50 per pound. b. $20 per pound. c. $80 per pound. d. $100 per pound.
The process of taking advantage of market inefficiencies to earn profits is called:
A. arbitrage. B. technical analysis. C. a random walk. D. futures contracting.
The marginal product of a variable input is
A. the second derivative of the total product function. B. zero at the point of diminishing returns. C. the change in the total product that occurs in response to a unit change in the variable input. D. the change in the average product that occurs when the variable input is increased one unit.