It takes many years to train to become an orthopedic surgeon. This suggests that, in the short run, a sudden increase in the demand for orthopedic surgeons will:
A. lead to a large increase in the number of orthopedic surgeons.
B. have no impact on the number of people who decide to become orthopedic surgeons.
C. not affect the salaries of orthopedic surgeons.
D. have little effect on the number of trained orthopedic surgeons.
Answer: D
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Control of monetary policy rests with
A) Congress. B) the President. C) the Federal Reserve. D) the Comptroller of the Currency. E) the U.S. Treasury.
In the first half of 2008, food and energy costs in the United States increased. At the same time, the financial crisis slowed production as firms predicted lower profits. A ________ macroeconomist would support the use of ________
A) classical; taxes to push the economy back to full employment B) Keynesian; fiscal or monetary policy to stimulate aggregate demand C) classical; monetary policy to stimulate aggregate demand D) Keynesian; technology to push the economy back to full employment
The money supply is $10 million, currency held by the nonbank public is $2 million, and the reserve—deposit ratio is 0.2. Bank reserves are equal to
A) $1.6 million. B) $2 million. C) $4 million. D) $8 million.
In the Keynesian model, which of the following will cause a reduction in interest rates?
A) An increase in money demand B) An increase in money supply C) An increase in saving D) A decline in saving