When the Federal Reserve purchases a government bond from a primary dealer, reserves in the banking system ________ and the monetary base ________, everything else held constant

A) increase; increases
B) increase; decreases
C) decrease; increases
D) decrease; decreases


A

Economics

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Briefly explain the loan able funds theory of interest rate determination

What will be an ideal response?

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Monopolistic competition resembles pure competition because:

A. both industries emphasize nonprice competition. B. in both instances firms will operate at the minimum point on their long-run average total cost curves. C. both industries entail the production of differentiated products. D. barriers to entry are either weak or nonexistent.

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The type of unemployment created by the normal rate of reentry and entry into the labor force is

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