Which of the following actions of the Fed is likely to lead to a decrease in the money supply?
a. A decrease in the discount rate
b. An increase in reserve requirements
c. A decrease in reserve requirements
d. A purchase of government securities by the Fed in the open market
b
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Refer to Figure 21.2. Which country has the more unequal distribution of income?
A) Urbania B) Ruratania C) They may have the same absolute income distribution although their relative income distribution is different. D) There is insufficient information to answer the question.
If a monopoly is operating on the demand curve where price elasticity is equal to -3, and price equals 3, then MR is equal to
A) -1. B) 1. C) -2. D) 2.
The term "crowding out" refers to the phenomenon that occurs when increased government spending
A) raises the price level and reduces consumption. B) leads to higher interest rates which reduces private investments. C) leads to higher bond prices which decreases the demand for Treasury bonds. D) leads to increased budget deficits that ultimately warrant increases in income taxes.
If A>B and B>C do not imply A>C, where > means "preferred to", then preferences are intransitive
Indicate whether the statement is true or false