The supply of money curve is
A) vertical because the quantity of money is fixed at any one moment.
B) horizontal because interest rates are fixed at any one moment.
C) horizontal because the Fed controls the quantity of money supplied.
D) upward sloping, showing the influence of the interest rate.
E) downward sloping, showing the negative influence of the interest rate.
A
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Those factors that lead to differences in the proximate causes of prosperity between nations are referred to as:
A) endogenous causes of prosperity. B) implicit causes of prosperity. C) explicit causes of prosperity. D) fundamental causes of prosperity.
If a natural monopoly does not inflate its costs, the output it produces is the smallest when the monopoly is
A) left unregulated. B) regulated according to an average cost pricing rule. C) regulated according to a marginal cost pricing rule. D) regulated to maximize total surplus.
When we compare PAE and actual output (Y) if PAE is greater than Y we expect that:
A. eventually production will decrease. B. eventually production will increase. C. the government will intervene by cutting down on taxes. D. there will be no change in aggregate production.
During a drought, the price elasticity of demand for water is less than one. During a flood, the price elasticity of demand for water is greater than one. This means that the:
a. demand for water is elastic during a drought and inelastic during a flood. b. demand for water is inelastic during a drought and elastic during a flood. c. demand curve for water cannot have a constant slope. d. quantity of water people choose to consume is independent of the price