When the Federal Reserve buys bonds on the open market, it decreases the money supply
Indicate whether the statement is true or false
FALSE
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An inferior good is one for which
a. the compensated demand curve fails to be downward sloping. b. higher prices have relatively little effect on the quantity demanded. c. the income elasticity is positive but less than 1. d. increases in income result in lower quantities demanded.
Full-employment equilibrium occurs when
A) real GDP exceeds potential GDP. B) real GDP equals potential GDP. C) potential GDP exceeds real GDP. D) None of the above answers are correct.
The level of output at which marginal revenue equals zero is also the level of output at which a. total revenue is zero
b. profit is maximized. c. total revenue is maximized. d. total revenue is declining.
A tax is more likely to promote economic equality if it is
a. regressive. b. proportional. c. indirect. d. progressive.