When the Fed decides to enact expansionary monetary policy, the supply of loanable funds:
A. and the demand for loanable funds both decrease.
B. and the demand for loanable funds both increase.
C. increases, while the demand for loanable funds decreases.
D. decreases, while the demand for loanable funds increases.
Answer: C
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The concept of “random walk” applies most closely to forecasts of
A. consumer demand for a product after a price increase. B. the effects of a tax on the supply of oil. C. the effects of transfer payments on labor supply. D. the price of a particular stock one year from now.
A labor union composed of workers in the same industry is called
A) a craft union. B) an industrial union. C) a company shop. D) a guild.
If the demand effect dominates during a currency depreciation, then
a. real GDP should fall. b. real GDP should increase. c. the price level should fall. d. net exports should decrease.
In the IS-LM-PC model, investment does not depend on
A) T. B) Y. C) r. D) x.