The expectations theory
A) has difficulty explaining why U.S. Treasury securities have lower yields than corporate bonds.
B) has difficulty explaining why yields on bonds of different maturities move together.
C) has difficulty explaining why yield curves usually slope upward.
D) accounts well for the fact that yield curves usually slope upward.
C
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If the Federal Reserve simultaneously sells government bonds in the open market and raises reserve requirements, the
a. money supply will increase. b. money supply will decrease. c. money supply will stay the same. d. two tools will work against one another and the net effect on the money supply is uncertain.
The MR curve of a monopolist is
A) downward sloping and below the demand curve. B) downsloping and identical to the demand curve. C) downsloping and above the demand curve. D) horizontal and same as the market demand curve.
Tickets for the football championship were expensive but sold out within hours. On the day of the game, people were selling tickets outside the stadium for prices of twice the face value and more. Which of the following statements explains this scenario?
a. The supply and demand have reached equilibrium. b. The demand for tickets has decreased. c. The demand curve for tickets has shifted to the left. d. The supply curve for tickets is inelastic.
The federal budget deficit is calculated each year by:
A. subtracting consumption and investment from government spending. B. adding up consumption, investment, government purchases, and net exports. C. adding up the difference between government revenues and spending over the years of the nation's existence. D. subtracting government spending from government revenues.