If a society chooses fiat money as its money form, it
a. must guarantee its convertibility into gold
b. must worry about its liquidity
c. cannot make use of a banking system
d. must worry about controlling its quantity
e. must worry about controlling its demand
D
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Recall the Application. The Fed's goal of this policy was to ________ the prices of government bonds and mortgage securities and ________ the interest rates on both bonds and mortgages
A) increase; decrease B) decrease; decrease C) decrease; increase D) increase; increase
If the demand curve is horizontal and the supply curve is vertical, shifts of the supply curve will lead to
A) changes in the equilibrium quantity only. B) changes in the equilibrium price only. C) changes in both the equilibrium price and quantity. D) changes in the quantity demanded only.