In the above figure, if the interest rate is 4 percent, people
A) sell bonds so as to convert them into money.
B) buy bonds so as to have a better store of value.
C) petition the Fed to tighten the quantity of money.
D) buy stocks, because stocks are more liquid than currency.
A
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The effects of financial deregulation on the IS and LM curves ________ the volatility of interest rates as the curves shift, such as the change in the amount that the interest rate must ________ when the Fed conducts open market purchases
A) decrease, rise B) decrease, fall C) increase, rise D) increase, fall
One of the problems with the definition of economic growth is that
A) it overstates economic growth because it does not account for leisure time. B) it does not account for the distribution of income. C) it overstates economic growth because it does not account for the reduction in work time. D) it understates economic growth because it does not account for the reduction in work time.