Sometimes during wars, government expenditures are larger than normal. To reduce the effects this spending creates on interest rates,
a. the Federal Reserve could increase the money supply by buying bonds.
b. the Federal Reserve could increase the money supply by selling bonds.
c. the Federal Reserve could decrease the money supply by buying bonds.
d. the Federal Reserve could decrease the money supply by selling bonds.
a
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The demand for money increases and the demand curve for money shifts rightward as a result of
A) an increase in real GDP. B) a decrease in the price level. C) a decrease in the nominal interest rate. D) an increase in the use of credit cards. E) a decrease in the real interest rate.
The production function shows that potential GDP increases when the
A) price level rises. B) price level falls. C) inflation rate falls. D) quantity of labor employed increases. E) the wage rate falls.
As a result of the financial crisis of 2007-2009, Freddie Mac and Fannie Mae were brought under the direct control of the government
Indicate whether the statement is true or false
A restrictive monetary policy, all else equal, will:
A) depreciate the domestic currency. B) appreciate the domestic currency. C) all of the above. D) none of the above.