Which of the following statements is correct?
A) Open market purchases are expansionary and open market sales are contractionary.
B) Open market purchases are contractionary and open market sales are expansionary.
C) Both open market purchases and open market sales are expansionary.
D) Both open market purchases and open market sales are contractionary.
A
You might also like to view...
According to your authors, market clearing
A) is planned by all buyers. B) is planned by all sellers. C) is planned by all buyers and sellers. D) is planned by economists and government agencies. E) is an unintended consequence of people pursuing their own plans.
The federal budget deficit becomes _____ during recessions because _____
a. smaller; transfer payments increase and tax revenues decline b. larger; transfer payments increase and tax revenues decline c. larger; both transfer payments and tax revenues increase d. smaller; both transfer payments and tax revenues increase e. smaller; both transfer payments and tax revenues decrease
Monetarists argue that
A. Fiscal policy puts idle money balances to work, which reduces V. B. When there is a recession, people accumulate money balances, which increases V. C. The velocity of money increases as much as total spending falls so that MV remains constant. D. The velocity of money is constant.
Producer surplus is the difference between the most a person is willing to pay and market price.
Answer the following statement true (T) or false (F)