Expansionary monetary policy generally:
A. raises U.S. interest rates.
B. pushes down the value of the U.S. dollar.
C. increases the U.S. exchange rate.
D. increases the inflow of financial capital.
Answer: B
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People consume more fresh fruit in the summer than during the rest of the year, yet the prices of fresh fruit are lower in the summer than in other seasons. What accounts for this?
A) Fresh fruit is not subject to the law of supply. B) The supply of fresh fruit increases in the summer. C) Fresh fruit is an inferior good. D) Fresh fruit is not subject to the law of demand.
Monetary policy will be effective in changing the gross domestic product of a nation only if: a. planned investment expenditures are autonomous
b. planned investment expenditures are sensitive to interest rates. c. interest rates are unresponsive to changes in money supply. d. interest rates are sensitive to changes in the price level. e. planned investment expenditures are sensitive to interest rates.