In which of the following situations is expansionary monetary policy most effective?
A. The Fed raises the reserve requirement.
B. The Fed sells more securities.
C. The Fed raises the discount rate.
D. Banks are willing to lend excess reserves.
Answer: D
Economics
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Refer to the scenario above. Suppose a new legislative policy decreases the fine for speeding to $50. A reduction in the fine to $50:
A) makes it profitable for you to bribe. B) makes it profitable for Joe to bribe. C) changes the outcome of the game. D) will not change your dominant strategy.
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In Keynes's liquidity preference framework
A) the demand for bonds must equal the supply of money. B) the demand for money must equal the supply of bonds. C) an excess demand of bonds implies an excess demand for money. D) an excess supply of bonds implies an excess demand for money.
Economics