If the Fed wishes to raise the interest rate, it will
a. increase the money supply
b. decrease the money supply
c. increase money demand
d. decrease money demand
e. simply set a higher market interest rate
B
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Which of the following is considered to be a goal of monetary policy?
A) a low federal budget deficit B) fair wages C) price stability D) an end to poverty
Richard raises Rhode Island Red chickens. Consumers, when buying chicken in the supermarket, view all other types of chickens as perfect substitutes for the Rhode Island Red. There are no barriers to entry in the chicken industry and, as a result, there are many, many chicken producers. An economist knows that
a. if Richard raises his price, he differentiates his chickens from the others on the market b. the demand curve Richard faces is horizontal c. if Richard lowers his price, he differentiates his chickens from the others on the market d. Richard can increase brand loyalty and market share by advertising e. Richard's relevant market is not chicken
Which of the following practices are, at least in part, attempts to reduce moral hazard problems?
a. The income of waiters and waitresses depends heavily on tips. b. An employer pays below equilibrium wages because he thinks his employees are not working as hard as they could be. c. The professors leaves the room to prevent cheating on exams. d. Tenure professors are not supervised closely.
If the income elasticity for a particular good is negative, then:
A. as income increases, consumers will tend to purchase more of the good. B. as income increases, consumers will tend to purchase less of the good. C. the good is a normal good. D. the good is a luxury good.