In Japan, interest rates are close to zero. As a result, Keynesians would argue that money demand
a. has become much more interest rate elastic.
b. will shift upward.
c. has become much less interest rate elastic.
d. will shift downward.
e. will remain unchanged.
A
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Suppose a bank has $10 million in deposits with no excess reserves, and the reserve requirement is 20%. If the Fed reduces the reserve requirement to 5%, the bank can make a maximum loan of
A) $0. B) $0.5 million. C) $1.5 million. D) $2 million.
Refer to Table 2-10. What is Barney's opportunity cost of making a unicycle?
A) 2 pogo sticks B) 2.8 pogo sticks C) 1.75 unicycles D) 1/2 of a pogo stick
The monetary efficiency
A) loss from pegging the Norwegian krone to the euro (for example) will be higher if factors of production can migrate freely between Norway and the euro area. B) gain from pegging the Norwegian krone to the euro (for example) will be lower if factors of production can migrate freely between Norway and the euro area. C) gain from pegging the Norwegian krone to the euro (for example) will be higher if factors of production can not migrate freely between Norway and the euro area. D) gain from pegging say the Norwegian krone to the euro (for example) will be higher if factors of production can migrate freely between Norway and the euro area. E) gain or loss from pegging the Norwegian krone to the Euro cannot be predicted using the available information.