If the Federal Reserve wants to increase the money supply, it should:
A. increase reserve requirements.
B. conduct open-market purchases.
C. increase the discount rate.
D. increase the interest that it pays on reserves.
Answer: B
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Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. lower; higher D. higher; potential
Recall from Chapter 5: interest rates in the free market (without artificial lowering by the Fed) are largely determined by
A) Congress. B) arbitrary bank lending practices. C) household saving and consumption preferences. D) tax revenues and lobbying demands.
How is the IMF funded?
What will be an ideal response?
Emma uses a linear model to forecast quarterly same-store sales at the local Garden Center. The results of her multiple regression is: Sales = 2,800 + 200•T - 350•D where T goes from 1 to 16 for each quarter of the year from the first quarter of 2006 (‘06I) through the fourth quarter of 2009 (‘09 IV). D is a dummy variable which is 1 if sales are in the cold and dreary first quarter, and
zero otherwise, because the months of January, February, and March generate few sales at the Garden Center. Use this model to estimate sales in a store for the first quarter of 2010 in the 17th month; that is: {2010 I}. Emma's forecast should be: a. 5,950 b. 6,200 c. 6,350 d. 6,000 e. 5,850