If the Fed wants to lower the interest rate, it will
a. increase the money supply
b. decrease the money supply
c. increase money demand
d. decrease money demand
e. simply set a lower market interest rate
A
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Compare the consumer surplus, producer surplus, and deadweight loss that arise from average cost pricing with those that arise from profit-maximization pricing and marginal cost pricing
What will be an ideal response?
Which of the followings is a duty of the Board of Governors of the Federal Reserve System?
A) setting margin requirements, the fraction of the purchase price of the securities that has to be paid for with cash B) setting the maximum interest rates payable on certain types of time deposits under Regulation Q C) regulating credit with the approval of the president under the Credit Control Act of 1969 D) All governors advise the president of the United States on economic policy.
In the long run, foreign labor remains cheap when and if
A. it becomes highly efficient and competes successfully internationally. B. countries erect barriers to trade between poor countries. C. productivity increases more rapidly in poor countries than in rich countries. D. it remains inefficient compared to other countries’ labor.
In an open economy, the demand for loanable funds comes from
a. only those who want to buy domestic capital goods. b. only those who want to buy foreign assets. c. those who want to buy either domestic capital goods or foreign assets. d. None of the above is correct.