The Fed changes the federal funds rate using open-market operations.
a. true
b. false
Ans: a. true
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If one firm advertises and other firms in the market don't, then ______
A. the demand for the advertised good becomes more elastic B. the profit-maximizing quantity of the advertised good decreases be-cause total fixed costs increase C. the average cost of producing a small quantity of the advertised good rises but the average total cost of producing a large quantity might fall D. the economic profit made from the advertised good increases
The consumption theories proposed by Modigliani and Friedman suggest that during recessions consumers reduce
A) consumption and maintain saving. B) saving and maintain consumption. C) consumption and saving. D) consumption and investment.
Of the following groups, who gains from rent controls?
A) landlords B) construction workers and their union leaders C) poor people who have a hard time earning enough income to pay high rents D) high-income people who live in rent-controlled apartments
Which of the following could lead to a decline in aggregate supply in the U.S.?
a. The discovery of new mineral deposits in Arizona b. Higher real wage rates in the U.S. c. Lower personal income in France d. Cutbacks in government borrowing e. Rapid depreciation of the Swiss franc