Expansionary monetary policy involves actions that:
A. increase the money supply in order to decrease aggregate demand.
B. increase the money supply in order to increase aggregate demand.
C. reduce the money supply in order to decrease aggregate demand.
D. reduce the money supply in order to increase aggregate demand.
Answer: B
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Refer to the scenario above. What is the future value of John's deposit after one year?
A) $2,120 B) $2,180 C) $2,320 D) $2,460
The economic value which can be created by a transaction between two people, Ed (seller) and Luis (buyer), is $50 as Ed's opportunity cost of selling is $135 and Luis' valuation of the good is $185 . Suppose Ed and Luis do not speak the same language and Ed hires an interpreter who charges $2 per hour. Ed and Luis finally agree to a price of $160 . This implies:
a. Luis' valuation of the good will increase. b. Ed's opportunity cost will decline. c. economic value from the transaction will decline. d. Ed will receive to a lower benefit than Luis.
If businesses become very pessimistic and reduce spending, which of the following is the most likely in the short run?
a. An increase in output, an increase in money demand and an increase in the interest rate. b. A decrease in output, an increase in money demand and an increase in the interest rate. c. A decrease in output, a decrease in money demand and a decrease in the interest rate. d. An increase in output, a decrease in money demand and a decrease in the interest rate. e. A decrease in output, a decrease in money demand and an increase in the interest rate.
The $/€ bid rate is the:
a. Inverse of $/€ ask rate b. Inverse of €/$ ask rate c. Equal to the €/$ ask rate d. Equal to the €/$ bid rate e. Equal to the $/€ ask rate