Suppose that the bond market and the money market both start out in equilibrium, then the Federal Reserve decreases the money supply. The result will be a ______________ in the money market and a _________________ in the bond market, which will push bond prices _________________ and interest rates will ___________________ until a new equilibrium is reached
A) surplus; shortage; up; fall
B) shortage; surplus; down; rise
C) surplus; shortage; down; rise
D) shortage; surplus; down; fall
B
Economics
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A) accounting costs but not economic costs. B) accounting and economic costs. C) economic costs but not accounting costs. D) none of the above
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Indicate whether the statement is true or false
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When will a decrease in aggregate demand not result in a lower inflation rate in the short run?
What will be an ideal response?
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