A decrease in the nation's wealth, all other factors constant, would cause:
A. the bond demand curve to shift left.
B. bond prices to rise.
C. the bond supply curve to shift left.
D. interest rates to decrease.
Answer: A
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If textbook prices rise by 5% this year, and textbook purchases fall by 5% this year, then the price elasticity of demand is:
A) .05. B) .10. C) .55. D) .95. E) 1.0.
A seller's willingness to sell:
A. is the maximum price that a seller is willing to accept in exchange for a good or service. B. is the minimum price that a seller is willing to accept in exchange for a good or service. C. is his or her reserved minimum bid-price. D. must always equal the buyer's willingness to buy.
Over the last twenty years in the U.S., the number of banks has:
A. steadily decreased. B. stayed about the same. C. more than doubled. D. steadily increased.
Refer to the diagrams. Suppose that government undertakes fiscal policy designed to increase aggregate demand from AD 1 to AD 2 and thereby to increase GDP from X to Z. In terms of graph B, which of the following might explain why GDP increases to Y rather than to Z?
A. Depreciation of the dollar.
B. Reduction in tariffs imposed by our trading partners.
C. Decrease in the saving schedule.
D. Crowding-out effect.