If the Federal Reserve raises the federal funds rate, which one of the following will tend to happen as a result?
A. The supply curve for new cars will shift to the left.
B. The demand curve for goods and services bought with a credit card will shift to the left.
C. Home mortgage rates will decrease.
D. The rate of inflation will increase.
Answer: B
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What is the difference between a fixed exchange rate system and a managed float exchange rate system?
What will be an ideal response?
Which of the following statements describes a supply curve?
a. A supply curve is a graphic illustration of the relationship between supply, shown on the vertical axis, and demand, shown on the horizontal axis. b. A supply curve is a graphic illustration of the relationship between price, shown on the horizontal axis, and quantity, shown on the vertical axis. c. A supply curve shows the same information as a supply schedule. d. A supply curve shows the same information as a demand schedule.
Free trade means that nations can buy and sell goods from each other
a. unless absolute advantage favors one nation b. without government interference, e.g., tariffs and quotas c. without having to abide by comparative advantage d. and choose their own level of tariffs against each other e. according to their own national quotas
Contractionary monetary policy involves actions that:
A. reduce the money supply in order to increase aggregate demand. B. increase the money supply in order to increase aggregate demand. C. reduce the money supply in order to decrease aggregate demand. D. increase the money supply in order to decrease aggregate demand.