When the Federal Reserve increases the money supply, at the previous equilibrium interest rate households and firms will now have
A) the amount of money that they want to hold. B) more money than they want to hold.
C) less money than they want to hold. D) to sell Treasury bills.
B
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In order to stimulate the economy, the government uses fiscal policies such as reducing tax rates
a. True b. False Indicate whether the statement is true or false
Suppose we were analyzing the pound per Swiss franc foreign exchange market. If Switzerland's interest rate rises relative to England and nothing else changes, then the:
a. The supply of Swiss francs in the foreign exchange market rises, and the demand for Swiss francs in the foreign exchange market falls, causing a depreciation of the Swiss franc. b. The supply of Swiss francs in the foreign exchange market falls, and the demand for Swiss francs in the foreign exchange market rises, causing an appreciation of the Swiss franc. c. The supply of Swiss francs in the foreign exchange market rises, and the demand for Swiss francs in the foreign exchange market falls, causing an appreciation of the Swiss franc. d. The supply of Swiss francs in the foreign exchange market rises, and the demand for Swiss francs in the foreign exchange market rises, causing an uncertain change in the value of the Swiss franc. e. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate.
Which of the following would cause the demand for mathematicians to increase?
a. an increase in the productivity of physicists. b. an increase in the wage of mathematicians. c. a decrease in the productivity of mathematicians. d. an increase in the productivity of mathematicians.
A perfectly inelastic demand schedule:
A. rises upward and to the right but has a constant slope. B. can be represented by a line parallel to the vertical axis. C. cannot be shown on a two-dimensional graph. D. can be represented by a line parallel to the horizontal axis.