Suppose individuals decide to reduce their holdings of money market funds. Further assume that these decisions put funds into checkable deposits. Given this information, we know that
A) the demand for M1 would increase and the demand for M2 would decrease.
B) the demand for M1 would decrease and the demand for M2 would decrease.
C) the demand for M1 would increase and the demand for M2 would increase.
D) the demand for M1 would decrease and the demand for M2 would increase.
E) none of the above
A
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The opportunity cost for a student of attending college for a year is measured by
A. the benefit received by the student. B. the tuition paid for the year. C. the value of the most valued opportunity foregone by attending college. D. the total money outlays associated with attending college.
With free trade between China and the United States, the winners are ___________ and the losers are _______
A. U.S. consumers of U.S. imports; U.S. producers of the U.S. import good B. China's consumers of China's imports; China's producers of its export good C. U.S. producers of the U.S. export good; U.S. consumers of U.S. imports D. China's consumers of China's export good; China's producers of its imported good
Assume that a central bank with a history of inflation announces that it is going to reduce money growth and inflation. According to the rational expectations model, the public will
a. immediately reduce their expected price level and inflation. b. reduce their expected price level if this announcement is credible. c. reduce their money and real wages if this announcement is credible. d. immediately be open to reducing their money wage. e. both b and c.
The federal government granted 200 million acres of land to railroads. Which of the following statements presents accurate information about these land grants?
a. The railroads were required to return 1/3 of the profits from the sale of this land to the federal government. b. The alternate section provision allowed state governments to purchase portions of the land grants from the railroads at reduced prices. c. The system of land grant subsidies were difficult to eliminate because of public opposition. d. Congress required railroad companies that received land grants to transport mail, troops and government property at reduced rates.