Exhibit 20-1 Money market demand and supply curves
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Beginning from an equilibrium at E1 in Exhibit 20-1, a decrease in the money supply from $150 billion to $100 billion causes people to:
A. sell bonds and drive the price of bonds down.
B. sell bonds and drive the price of bonds up.
C. buy bonds and drive the price of bonds down.
D. buy bonds and drive the price of bonds up.
Answer: A
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A) remains the same. B) decreases. C) increases. D) becomes more costly.
An asset that derives its value from some other underlying asset is a
A) stock. B) bond. C) derivative. D) CD.
The implementation of new production methods by managers, such as the "just-in-time" inventory system, increases:
A. the unemployment rate. B. the share of the population employed. C. average labor productivity. D. the quantity of human capital.
What is the type of companies that provide services by linking individuals to others with similar interests or to companies that sell certain products?
A. not-for-profit firms B. government agencies C. non-transaction firms D. platform firms