To decrease the money supply the Fed can:
A. Reduce the reserve requirement, raise the discount rate, or sell bonds.
B. Raise the reserve requirement, raise the discount rate, or sell bonds.
C. Raise the reserve requirement, reduce the discount rate, or buy bonds.
D. Raise the reserve requirement, raise the discount rate, or buy bonds.
B. Raise the reserve requirement, raise the discount rate, or sell bonds.
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Which of the following is true of the model of perfect competition?
a. There is a high degree of product differentiation. b. Consumers do not have adequate information concerning the prices and quality of products in the market. c. There are significant barriers to entry and exit. d. There are only a few, large firms in the market. e. An individual firm cannot affect the market price.
Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and the nominal value of the domestic currency in the context of the Three-Sector-Model?
a. Real GDP rises, and nominal value of the domestic currency rises. b. Real GDP rises, and nominal value of the domestic currency falls. c. Real GDP rises, and nominal value of the domestic currency remains the same. d. Real GDP falls, and nominal value of the domestic currency rises. e. There is not enough information to determine what happens to these two macroeconomic variables.