As part of the "wealth channel of monetary policy," a higher money supply __________ bond prices and thus __________ spending
A) raises; raises consumption
B) raises; raises investment
C) lowers; lowers consumption
D) lowers; lowers investment
A
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What economic argument suggests that if transactions costs are sufficiently low, the post-bargaining equilibrium is economically efficient regardless of how property rights are distributed?
a. the Coase theorem b. the laws of supply and demand c. the law of comparative advantage d. the law of externalities
A decrease in price causes:
A. a price effect, which is an increase in revenue that results from receiving a lower price for each unit sold. B. a decrease in quantity demanded. C. a quantity effect, which is an increase in revenue that results from selling fewer units of the good. D. both a price effect and quantity effect.
The relationship between quantity supplied and price is usually
A. a direct relationship. B. an inverse relationship. C. a negative relationship. D. impossible to determine.
Excess reserves in a bank are the difference between required reserves and the bank's total net worth.
Answer the following statement true (T) or false (F)