The money market rate observed most closely by the Open Market Account Manager is the
A) Treasury bill rate.
B) commercial paper rate.
C) discount rate.
D) federal funds rate.
D
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In the long run, when the Fed increases the quantity of money the
A) no real variable changes. B) price level falls. C) real interest rate rises. D) nominal interest rate falls.
The finance of government spending through a Treasury sale of bonds which are then purchased by the Fed
A) causes both reserves and the monetary base to rise. B) causes both reserves and the monetary base to decline. C) causes reserves to rise, but the monetary base to decline. D) has no net effect on the monetary base.
The short-run simulative effect of a government budget deficit on real GDP is stronger with ________ financing, since this ________ the crowding out effect of the deficit
A) bond, enhances B) bond, eliminates C) money, enhances D) money, eliminates
If Sean sells Susan a DVD player for $30,
A) both Sean and Susan will gain from this transaction. B) the well-being of both parties will be unchanged. C) Sean will gain from the transaction, but Susan will lose. D) Susan will gain from the transaction, but Sean will lose.