Which of the following is correct?
A. SMC = PMC - MD
B. MPB = MSB + MEB
C. SMC = PMC + MD
D. MSC = MPB
E. MSB = MSC + MPB
C. SMC = PMC + MD
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What is the equation of exchange? Suppose that real GDP and velocity are constant. In this case, what effect will an increase in the quantity of money have?
What will be an ideal response?
The __________ gives loans to medium-income, creditworthy countries, and the ________ gives aid to poorer countries.
A. IDA; UNDP B. IDA; IBRD C. IBRD; IDA D. UNDP; IBRD
The principle of specialization and exchange implies that
a. total production is highest when individuals specialize according to their absolute advantages b. productive inefficiency increases as producers in society specialize c. exchange can only occur when there is specialization in the economy d. gains from specialization will only occur when society is operating at a point along its production possibilities frontier e. total production is highest when individuals specialize according to their comparative advantages
If the current market federal funds rate equals the target rate and the demand for reserves increases, the likely response in the federal funds market will be:
A. an increase in the market federal funds rate. B. a decrease in the market federal funds rate. C. a market federal funds rate that will equal the target rate. D. nothing; reserve supply is so high that the market federal funds rate will be unchanged.