If supply is upward-sloping and demand is downward sloping, what happens to the equilibrium real risk-free interest rate and quantity of real loanable funds per time period if there is a decrease in the real saving and a decline in business investment?
a. The real risk-free interest rate falls and the quantity per time period rises.
b. The real risk-free interest rate falls and the quantity per time period is uncertain.
c. The real risk-free interest rate does not change and the quantity per time period rises.
d. The real risk-free interest rate is uncertain and the quantity per time period rises.
e. The real risk-free interest rate is uncertain and the quantity per time period falls.
.E
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Which of the following factors make a barter system inefficient relative to a money system?
a. Unanticipated inflation in the money system b. Gains from trade for buyers in barter transactions come at the expense of an equivalent loss from trade for sellers. c. Complete dependence on double coincidence of wants in a barter system. d. People in close-knit communities cannot trust the quality of the barter goods being exchanged.
An increase in the quantity of money by the Fed
A) raises the interest rate, decreases investment, and shifts the AD curve rightward. B) lowers the interest rate, decreases investment, and shifts the AD curve rightward. C) lowers the interest rate, increases investment, and shifts the AD curve leftward. D) None of the above answers is correct.
An import-licensing requirement, or import restrictions pertaining to the product quality and safety, are examples of:
A. Protective tariffs B. Nontariff barriers C. Voluntary export restrictions D. Quotas on imported products
Which of the following could have led to the shifts illustrated in the figure above?
i. The U.S. exchange rate was expected to depreciate between 2001 and 2009. ii. The U.S. exchange rate was expected to appreciate between 2001 and 2009. iii. The U.S. interest rate rose relative to interest rates in other countries between 2001 and 2009. A) i only B) ii only C) iii only D) i and iii E) ii and iii