An increase in the inflation rate will lead to a ________ nominal interest rate, which will ________ the debt-to-GDP ratio
A) higher; raise
B) higher; reduce
C) lower; raise
D) lower; reduce
A
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To change the rate of growth of the money supply, the Fed can do all but which one of the following?
A) Shift the demand for money curve by changing the interest rate. B) Engage in open market operations. C) Change the discount rate. D) Change the required reserve ratio.
The quantity of real money demanded is
A) negatively related to the price level. B) positively related to the price level. C) independent of the price level. D) proportional to the price level
Historical evidence shows that the relationship between interest rates and investment is
A) indeterminable. B) positive. C) negative. D) None of the above.
A market system (market economy) depends on the market to
a. find the most efficient way of using resources. b. determine how large the budget deficit should be. c. decide how much government regulation there should be. d. provide minimum incomes for everyone. e. All of the above are correct.