Positive economics is descriptive because:
A) it is based on ethical judgments.
B) its predictions cannot be verified with data.
C) it prescribes what an individual or society ought to do.
D) it explains what has happened or predicts what will happen.
D
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The monetary base is
A) currency and reserves of depository institutions. B) currency minus depository institutions' reserves. C) depository institutions' reserves minus Federal Reserve notes. D) the money borrowed by banks from other banks.
The initial impact of the Fed's open market sale of government securities to banks is
A) an increase in the quantity of money by some multiple of the dollar volume of the sale. B) an increase in bank deposits at the Fed. C) a decrease in the quantity of money by some multiple of the dollar volume of the sale. D) a decrease of the banking system's reserve deposits at the Fed.