Assume a fixed demand for money curve and the Fed decreases the money supply. In response, people will:
a. sell bonds, thus driving up the interest rate.
b. sell bonds, thus driving down the interest rate.
c. buy bonds, thus driving up the interest rate.
d. buy bonds, thus driving down the interest rate.
a
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If the price of a six-pack of Pepsi falls from $4 to $3 and the quantity purchased increases 80 percent, then demand is
A) inelastic. B) elastic. C) unit elastic. D) perfectly inelastic. E) perfectly elastic.
The marginal propensity to consume is the slope of the consumption function
Indicate whether the statement is true or false
A dynamic game is a game
A) in which the players are highly animated. B) that is sequential or repeated. C) where the payoffs change frequently. D) that has actions instead of strategies.
The classical model does a poor job of explaining the __________ because it assumes that the __________ always clears
a. long run; labor market. b. long run; financial market. c. short run; labor market. d. short run; financial market. e. short run; housing market.