In the simple liquidity-preference model, the money supply curve is:
A. vertical, and moves at the sole discretion of the Fed.
B. horizontal, and moves at the sole discretion of the Fed.
C. vertical, and moves when people change their rate of savings.
D. horizontal, and moves when people change their rate of savings
A. vertical, and moves at the sole discretion of the Fed.
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Trade deficits always lead to future decreases in consumption if the trade deficits
A) support current investment. B) support current consumption. C) require borrowing from abroad. D) support either current investment or current consumption.
Once a firm’s marginal revenue curve is known, the output level can be determined.
Answer the following statement true (T) or false (F)
Refer to the accompanying figure. Assume demand remains unchanged at D1. If supply shifts from S2 to S1, then the equilibrium price will ________ and the equilibrium quantity will ________.
A. rise; rise B. fall; fall C. fall; rise D. rise; fall
If the banking sector borrows internationally and lends locally, how does this intensify a financial crisis?
What will be an ideal response?