The crowding-out effect arises when:
A. Government lends in the money market, thus decreasing interest rates
B. Government borrows in the money market, thus decreasing interest rates
C. Government lends in the money market, thus increasing interest rates
D. Government borrows in the money market, thus causing an increase in interest rates
D. Government borrows in the money market, thus causing an increase in interest rates
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Everything else remaining unchanged, if the demand curve for reserves shifts to the left and borrowed reserves is zero:
A) there will be a decrease in both the federal funds rate and the quantity of reserves. B) there will be a decrease in the federal funds rate but no change in the quantity of reserves. C) there will be an increase in the federal funds rate but no change in the quantity of reserves. D) there will be an increase in both the federal funds rate and the quantity of reserves.
At the end of last year the Consumer Price Index was equal to 157.5 and at the end of this year it was equal to 163.8. What is the inflation rate over this time period?
A) 6.3 percent B) 4.0 percent C) 3.85 percent D) 10.1 percent
If a firm is earning negative economic profits, it implies
a. That the firm's accounting profits are necessarily zero b. That the firm's accounting profits are necessarily positive c. That the firm's accounting profits are necessarily negative d. Economic profits alone cannot determine accounting profits
We translate nominal income in any past year into constant, real dollars to:
A. allow us to compare changes in purchasing power over time. B. see what an income we were earning in the past would be equivalent to today. C. understand what a salary in the past would equal in current dollars to determine how much more we have actually gained in purchasing power. D. All of these statements are true.