If the Fed wants to raise interest rates, then it can use its open market operations to:
A. increase the money supply.
B. decrease the money supply.
C. increase money demand.
D. decrease money demand.
Answer: B
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If a macroeconomist studying the causes of unemployment asserts that a particular change in technology will cause the rate of unemployment to decrease by ten percent, then this macroeconomist is at which step in the process of developing an economic
model? A) Identify the endogenous variables. B) Develop a model. C) Compare the model with the data. D) Identify the exogenous variables. E) Conduct prediction and policy analysis.
Which is NOT an example of moral hazard
a. people eat more at all-you-can-eat buffets b. loggers clear-cut a tract of land when paying a fixed fee rather than when paying per tree felled c. Drivers of heavier, safer cares are less likely to run stop signs d. workers on commission work harder than those paid an hourly wage
M2 is equal to M1 plus:
a. savings deposits, money market deposit accounts, small time deposits, and eurodollars. b. savings deposits, money market deposit accounts, money market mutual funds, and eurodollars. c. small time deposits, money market deposit accounts, money market mutual funds, and eurodollars. d. savings deposits and small time deposits of less than $100,000. e. money market mutual funds, money market deposit accounts, savings deposits, large time deposits, and repurchase agreements.
Which of the following will cause the money supply to decline?
A) lowering the discount rate B) raising the required reserve ratio C) an open market purchase D) an open market sale E) b and d