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.
A
You might also like to view...
Referring to the graph above, a movement from point H to point I might represent ________
A) the increase in the inflation rate that occurs when the real interest rate rises B) the automatic response of monetary policy to an increase in the inflation rate C) an autonomous tightening of monetary policy D) any of the above E) none of the above
The possibility that a borrower might engage in riskier behavior after a loan is made is called
A) adverse selection. B) liability aversion. C) moral hazard. D) the risk of default.
Anna Arbor typically earns $40,000 per year and has an MPC equal to 0.90, but wins $100,000 in the lottery in 2001 . Her consumption for 2001, according to Milton Friedman, will be
a. $100,000 b. $64,000 c. $36,000 d. $116,000 e. $16,000
If a country has a trade surplus of $60 billion, which of the following can be true?
A. The country's exports are $160 billion, and its imports are $60 billion. B. The country's exports are $180 billion, and its imports are $120 billion. C. The country's exports are $110 billion, and its imports are $190 billion. D. The country's exports are $120 billion, and its imports are $180 billion.