Why did the monetary base increase rapidly during the economic crisis of 2008?
a. The Fed sold financial assets and extended fewer loans.
b. The Fed increased both its purchase of assets and quantity of loans extended.
c. The Fed increased its purchases of assets, but offset this with an increase in the reserve requirement.
d. The Fed sold financial assets, but offset this with a reduction in the reserve requirement.
B
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How can the influence of a third variable be shown on a two-dimensional graph?
A) by allowing the position of the relationship line or curve to shift on the graph B) by super-imposing the third variable on the two-dimensional graph C) by drawing a third axis coming out of the two axes D) by allowing the relationship to be nonlinear
According to Ricardian Equivalence, crowding-out ________
A) is incomplete B) will raise the level of domestic income C) is complete D) does not play a role in influencing private investment levels