If the interest rate falls, the present value of $100 to be received in one year
A) rises.
B) falls.
C) is unaffected.
D) might rise, fall, or not change.
A
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Open market purchases and sales are conducted at the:
A) Federal Reserve Bank of Kansas City. B) Federal Reserve Bank of New York. C) Federal Reserve Bank of Chicago. D) Federal Reserve Bank of St. Louis.
Income effect of lower wages implies
a. workers prefer leisure to work. b. an increase in the productivity of labor. c. a fall in the demand for labor. d. workers would want to work more.
If firms are producing at a profit-maximizing level of output where the price is less than the average total cost:
A. accounting profits will be zero. B. accounting profits must be positive. C. economic profits are negative. D. economic profits may be positive.
Other things being equal, an expansion of commercial bank lending:
A. is desirable during a period of demand-pull inflation. B. increases the money supply. C. reduces the money supply. D. changes the composition, but not the size, of the money supply.