Other things the same, if the Fed increases the quantity of money, the ________ because ________
A) nominal interest rate decreases; the supply of money curve shifts rightward
B) nominal interest rate increases; the supply of money curve shifts rightward
C) nominal interest rate does not change; only the real interest rate is effected
D) nominal interest rate decreases; the supply of money curve shifts leftward
E) nominal interest rate increases; the supply of money curve shifts leftward
A
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The brief success of the OPEC cartel in the 1970s can most plausibly be attributed to
A) the dependence of industrial economies on oil. B) the fact that OPEC was a cartel formed by national governments. C) the inelastic demand for oil. D) the misguided policies of the U.S. government. E) the widespread expectation of much higher prices in the future.
Which of the following individuals is not hurt by inflation?
A. Akshay, who borrowed $1,000 from a friend and agreed to pay the same amount one year later, but during the year, prices increased by 10 percent. B. Vjiay, who lent his friend $1,000 and agreed to accept repayment of the same amount one year later, but during the year, prices increased by 10 percent. C. Randall, who lives on a fixed income of $800 per month. D. Asuza, who keeps her savings in the form of cash in a safe at home.