The U.S. economy is experiencing rising output, rising employment, rising incomes and falling unemployment. These conditions best describe a business cycle ________
A) recession B) peak C) trend D) trough E) expansion
E
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When the Fed engages in an open market purchase, the money supply ________ and the nominal interest rate ________.
A. increases; increases B. decreases; increases D decreases; decreases C. increases; decreases
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
What will happen to a country that fixes the price of foreign exchange below equilibrium?
Rice consumption per capita in China is falling while income per capita is rising, other things being equal. This means that
A. rice demand is price inelastic. B. rice has many substitutes. C. rice is an inferior good. D. None of the above.