In Keynes's view, an excess quantity of money supplied causes people to:
A. sell bonds and the interest rate rises.
B. buy bonds and the interest rate falls.
C. buy bonds and the interest rate rises.
D. increase speculative balances.
Answer: B
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Economic growth is measured by the percentage change in: a. potential nominal GDP
b. structural unemployment. c. the rule of 72. d. potential real GDP (LRAS).
Which of the following is NOT an example of an externality?
A) A cookie company emits a wonderful aroma in the air that makes people smile. B) The neighbor's wind chimes interfere with your sleep. C) A firm lays off 100 workers. D) Cancer-causing chemicals are dumped into the drinking water supply of a city.
Which of the following is not an autonomous determinant of consumption expenditures?
a. real wealth b. the interest rate c. tastes and preferences d. current disposable income
Fumiyo deposits $90,000 into Blue Flag Bank and Lyle deposits $75,000. Blue Flag Bank’s required reserve ratio is 11 percent. How much of these two deposits can the bank lend to borrowers?
a. $146,850 b. $18,150 c. $15,375 d. $150,000