Above the equilibrium nominal interest rate, there is a surplus of money
a. True
b. False
Indicate whether the statement is true or false
True
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According to this Application, during the late 1980s, Argentina pegged its currency to the U.S. dollar. When the dollar appreciated sharply on world markets after 1995, this caused a large trade deficit in Argentina because
A) Argentina could no longer afford to purchase as many imported products. B) Argentinean exports grew relative to the nation's imports. C) U.S. exports to Argentina declined. D) Argentinean exports became relatively more expensive in global markets.
Suppose Hillary was offered the following choice: Option 1 is to win $10 for sure and Option 2 is to win $20,000 with odds of 1 in 2,000 and otherwise to win nothing. If Hillary is risk averse she
A. will choose Option 1. B. will choose Option 2. C. is indifferent between the two. D. will choose Option 1 or Option 2 with equal probability.
The world's most important reserve currency is the
A. American dollar. B. British pound. C. German mark. D. Japanese yen.
Other things equal, which of the following would increase the federal funds rate?
A. A decrease in loan demand in the federal funds market. B. A decrease in the reserve ratio. C. Fed purchases of government securities from banks. D. A decline in excess reserves in the banking system.