An unexpected rise in GDP growth should send bond prices __________ and stock prices __________
A) up; up
B) up; down
C) down; up
D) down; down
C
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Which of the following is the correct way to describe equilibrium in a market?
A) At equilibrium, market forces no longer apply. B) At equilibrium, quantity demanded equals quantity supplied. C) At equilibrium, demand equals supply. D) At equilibrium, scarcity is eliminated.
According to the Ricardian view of government deficits,
A. any future burden of tax financing should be ignored. B. government deficits reduce interest rates. C. taxpayers are less capable of saving when debt finance is used rather than tax finance. D. the private sector supply of loanable funds will increase in the face of government deficits.
A central bank like the Federal Reserve in the United States can help banks survive a bank run by
A) raising the discount rate. B) acting as a lender of last resort. C) printing money. D) increasing the required reserve ratio.
How can the Cambridge equation be restated according to Friedman's money demand theory?
a. Md = k(rB, rE, rD)Py b. Md = k/Py(rB, rE, rD) c. Md = Py/k(rB, rE, rD) d. Md = (rB, rE, rD)Py/k