Suppose that the Fed makes a $100 billion open-market sale of Treasury bonds, and the money multiplier is 6 . Which of the following impacts aremostlikely to result?
a. The money supply shifts inward, and the equilibrium interest rate rises in the money market.
b. The money supply shifts outward, and the equilibrium interest rate falls in the money market.
c. Investment declines, causing the aggregate demand curve to shift leftward, reducing equilibrium real GDP and thus slowing the economy.
d. Both a. and c. are correct.
e. Both b. and c. above are correct.
d
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Which of the following is illustrated by the distance between the aggregate expenditure line and the 45-degree line at each level of real GDP?
a. The level of saving in an economy b. Unplanned inventory change c. Planned investment undertaken in an economy d. The marginal propensity to save e. The marginal propensity to consume
Which of the following is true regarding economic fluctuations in the United States?
a. Since World War II, economic ups and downs have been more moderate than before the war. b. Prior to World War II, real GDP annual increases of more than 5 percent were unheard of. c. Real GDP grew rapidly during the 1930s. d. The 1920s was a period of prolonged economic stagnation and high unemployment.
The welfare rolls today are
A. much higher than they were in 1994. B. A little higher than they were in 1994. C. a little lower than they were in 1994. D. much lower than they were in 1994.
Installing software to limit screen time, forcing you to uninstall it every time you reach the limit, is an example of:
A. a commitment device. B. increasing the cost of a vice. C. can be explained through behavioral economics. D. All of these are true.