To decrease the money supply the Fed can:
A. Reduce the reserve requirement, raise the discount rate, or sell bonds.
B. Raise the reserve requirement, raise the discount rate, or sell bonds.
C. Raise the reserve requirement, reduce the discount rate, or buy bonds.
D. Raise the reserve requirement, raise the discount rate, or buy bonds.
B. Raise the reserve requirement, raise the discount rate, or sell bonds.
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If price is above the average variable cost but below the average total cost of a representative firm in a competitive industry
a. There will be new industries blooming over time b. There will be an interest in the industry over time c. There will be an exit from the industry over time d. All of the above e. None of the above
If consumption is defined as C = 4,500 + 0.75Y, then the marginal propensity to save is 0.25
Indicate whether the statement is true or false
In the Keynesian model in the long run, an increase in taxes causes the price level to ________ and the real interest rate to ________
A) fall; rise B) fall; fall C) rise; rise D) rise; fall
Write out the equation of exchange. What assumptions did the classical economists make about the variables that compose the equation, and what did this lead them to conclude about money and prices?