To increase the money supply, the Fed purchases government securities from banks, paying for them with new reserves
a. True
b. False
Indicate whether the statement is true or false
True
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During World War I (1914–18), the government supported the cause of labor when it
(a) reduced the work day to eight hours in all government jobs. (b) reduced the work day to eight hours in all private sector jobs. (c) enforced the eight-hour work day in all government jobs. (d) enforced the eight-hour work day in all private jobs.
A decrease in the price of a commodity results in a(n)
a. decrease in supply b. decrease in quantity demanded c. increase in demand d. decrease in quantity supplied e. increase in supply
In the short run (specificfactors) model, what will happen to the rental rate on capital and the wage rate when there is FDI in the country?
a. Both the rental rate on capital and the wage rate will increase. b. Both the rental rate on capital and the wage rate will decrease. c. The rental rate on capital will increase and the wage rate will decrease. d. The rental rate on capital will decrease and the wage rate will increase.
If the government wished to shift aggregate demand to the left, it might:
A. decrease military spending. B. decrease corporate income taxes. C. increase the amount of educational grants available. D. All of these would cause a decrease in aggregate demand.