Consumption is likely to fall if ________

In the market for reserves, a lower discount rate

A) decreases the supply of reserves. B) increases the supply of reserves. C) lengthens the vertical section of the supply curve of reserves. D) shortens the vertical section of the supply curve of reserves.

Recall the Application about the decrease in the price of wool in the 1990s to answer the following question(s). In the 1990s, the world price of wool decreased by about 30 percent and prices have remained relatively low since then. In 2012, an organization in New Zealand proposed that sheep shearing be added to the Commonwealth Games and the Olympics as a spectator sport in an effort to increase the awareness and the demand for wool.Recall the Application. The decrease in the price of wool would be reflected by a movement ________ on the market supply curve for wool.

A. down and to the right B. down and to the left C. up and to the right D. up and to the left