The equilibrium quantity of money in circulation is determined by:
A. the interaction of an upward-sloping money supply curve and a downward-sloping money demand curve.
B. the Federal Reserve.
C. the decentralized interactions between households and businesses.
D. the nominal interest rate, real income, and the price level.
Answer: B
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When Jimmy is shopping for fire insurance for his condo, he finds that the insurance companies all require smoke detectors be installed before they will issue a policy. This is a way for the insurance companies to help reduce the problem of ________
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Describe the fractional reserve banking system
What will be an ideal response?
Output supply is increasing in the interest rate because
A) labor demand is increasing in the interest rate. B) labor demand is decreasing in the interest rate. C) labor supply is increasing in the interest rate. D) labor supply is decreasing in the interest rate.
One way to allocate the scarce good created from an effective price ceiling is to:
`A. offer it on a first-come, first-served basis. B. ration a certain quantity per household. C. give them to the friends and family of the producers. D. All of these are examples of allocating using non-price methods.