The Fed relies on three instruments to control the money supply. They are
a. taxes, reserve requirements, and the discount rate
b. government spending, the discount rate, and open market operations
c. reserve requirements, the discount rate, and currency liability
d. reserve requirements, the discount rate, and open market operations
e. reserve requirements, taxes, and open market operations
D
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To the extent that the value of money is less predictable, it becomes
A) more acceptable as a store of value. B) less acceptable as a medium of exchange. C) more acceptable as a standard of deferred payment. D) more acceptable as a unit of account.
In Keynes's liquidity preference framework
A) the demand for bonds must equal the supply of money. B) the demand for money must equal the supply of bonds. C) an excess demand of bonds implies an excess demand for money. D) an excess supply of bonds implies an excess demand for money.
Assume that employment decreases by 3%. Holding all other factors constant, we know with certainty that which of the following will occur?
A) output will decrease by 3% B) output per capita will decrease by 3% C) output will decrease by less than 3% D) the capital labor ratio will decrease E) none of the above
Which of the following equations is correct?
A) AVC - ATC = AFC B) AVC + ATC = AFC C) AFC + AVC = ATC D) ATC + AVC = AFC