According to Keynesians, an increase in the money supply will:
a. only increases prices.
b. increase the interest rate, and decrease investment, aggregate demand, prices, real GDP, and employment.
c. decrease the interest rate, and decrease investment, aggregate demand, prices, real GDP, and employment.
d. decrease the interest rate, and increase investment, aggregate demand, prices, real GDP, and employment.
d
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Banks prefer __________ hold excess reserves because __________
A) not to; excess reserves earn no interest B) not to; banks are not required to hold them C) to; excess reserves earn interest D) to; banks need them to prevent runs
Consider two goods X and Y available for consumption. Assume that the price of X changes while the price of Y remains fixed. For these two goods, the price-consumption curve illustrates the
A) relationship between the price of X and consumption of Y. B) utility-maximizing combinations of X and Y for each price of X. C) relationship between the price of Y and the consumption of X. D) utility-maximizing combinations of X and Y for each quantity of X.
Which of the following is true?
a. Patents reduce a firm's incentive to develop new products. b. Patents are given for new works of art or literature. c. Patents give a permanent exclusive right to produce a new good. d. Patents give a temporary exclusive right to produce a new good. e. Patents guarantee economic profits.
The ECB would be unable to prevent a large banking crisis in the Eurozone because:
A) it can print money but is prohibited from lending to banks or central banks in the member states. B) crises of such proportions would require an international effort. C) deposits in banks in the Eurozone have FDIC insurance and are therefore out of the control of the ECB. D) its assets are inadequate.