Refer to Figure 15.6. Which of the following Fed actions is most likely to decrease the aggregate demand curve from AD2 to AD1?
A. Lowering the discount rate.
B. Buying bonds in the open market.
C. Raising the federal funds rate.
D. Decreasing the reserve requirement.
Answer: C
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Part B of the Medicare program covers _____ and is _____
a. pharmaceuticals; voluntary b. pharmaceuticals; mandatory c. physician costs; voluntary d. physician costs; mandatory
If there is a ceiling price below the equilibrium level, a decrease in demand will worsen the shortage
a. True b. False Indicate whether the statement is true or false
Government intervention can be productive and efficiency enhancing:
A. because the government always acts with altruistic motives. B. in markets for public goods and common resources. C. whenever it regulates a market. D. except in markets for public goods.
Suppose that a price discriminating monopolist is able to divide its market into two groups. If the firm sells its product for $50 to the group whose customers have the most elastic demand, what price are they likely to charge to the group whose customers have the least elastic demand?
A. $50 B. more than $50 C. less than $50 D. The answer depends on the marginal revenue for that group.