Assume that the central bank increases the reserve requirement. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the quantity of real loanable funds per time period and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive).
b. The quantity of real loanable funds per time period falls, and net nonreserve-related international borrowing/lending becomes more negative (or less positive).
c. There is not enough information to determine what happens to these two macroeconomic variables.
d. The quantity of real loanable funds per time period and net nonreserve-related international borrowing/lending remain the same.
e. The quantity of real loanable funds per time period falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative).
.E
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The mandate for the monetary policy goals that has been given to the European Central Bank is an example of a ________ mandate
A) primary B) dual C) secondary D) hierarchical
Reducing a tariff on a particular good does which of the following? a. It decreases the price of the domestic good to domestic consumers
b. It increases the price of the good to domestic consumers. c. It redistributes income away from domestic producers toward domestic consumers. d. both (a) and (c)