If the Fed wanted to use all of its policy variables to decrease the supply of money, which of following would that include?
a. Increasing its open market sales of government securities.
b. Increasing the required reserve ratio
c. Decreasing the interest rate it pays banks on bank reserves.
d. It would include all of the above.
d
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The three ways government can alter aggregate demand are:
A. Agriculture subsidies, science & technology subsidies, and education grants. B. Provide or deny food, clothing, and shelter. C. Nationalization of private businesses, institution of price controls, and Pigouvian taxes on externalities. D. Tax the Internet, close the bars, and ban football. E. Government spending, tax policy, and transfer of income
Adhira buys chocolates and almonds. She has 3 bars of chocolates and 4 bags of almonds. The marginal utility of the third chocolate bar is 18 units of utility and the marginal utility from the fourth bag of almonds is also 18. Is Adhira maximizing her
utility? A) Yes, the marginal utility from the last unit of each good is equal. B) No, she must buy 1 more chocolate bar to equate her quantities of the two goods. C) No, she must cut back to 3 bags of almonds to equate her quantities of the two goods. D) No, without information on her income and the prices of the two goods, we cannot answer the question.