The money supply would tend to fall if the Fed
A) sells bonds.
B) buys bonds.
C) lowers the discount rate.
D) lowers reserve requirements.
A
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Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and GDP Price Index in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period rises, and GDP Price Index rises. b. The quantity of real loanable funds per time period falls, and GDP Price Index falls. c. The quantity of real loanable funds per time period rises, and GDP Price Index falls. d. The quantity of real loanable funds per time period and GDP Price Index remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
Cartels are unstable and will tend to fall apart due to cheating on the agreement.
Answer the following statement true (T) or false (F)
The path of ________ over a lifetime is likely to be much more stable than the path of ________.
A. saving; income B. consumption; income C. saving; consumption D. income; consumption
One of the main reasons some central banks set target inflation rates is to ______.
a. increase productivity b. simplify fiscal policy c. foster greater price stability d. boost investment from abroad