Which of the following statements is true?
A. The Federal Reserve sets the federal funds rate.
B. The Federal Reserve sets the target for the federal funds rate, and then uses the reserve
ratio to push banks toward that target.
C. The Federal Reserve does not set the federal funds rate, but it influences it through the
use of its open-market operations.
D. The Federal Reserve will set a higher target for the federal funds rate if pursuing an
expansionary monetary policy.
C. The Federal Reserve does not set the federal funds rate, but it influences it through the
use of its open-market operations
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? PriceQuantity Demanded Quantity Supplied $101,000 5,500 92,0005,00083,0004,50074,0004,00065,0003,50056,0003,00047,0002,50038,0002,00029,0001,500110,0001,000? Refer to Table 4-1. What is the equilibrium price in the example above?
A. $9 B. $8 C. $7 D. $6 E. $5
The price level is 3, total output is 500, and the money supply is 200. The velocity of money is
A) 7.5. B) 2.5. C) 2.0. D) None of the above.
Historically barriers to development in the U.S., such as the dry deserts of some of the country's western states, have been solved by
(a) only government action. (b) only private action. (c) a blend of government and private actions. (d) foreign expertise.
Marginal cost is calculated by dividing the change in total cost by the change in total output
a. True b. False Indicate whether the statement is true or false