The statement that "at 10 percent, the interest rate is too high for families to buy a home they could have afforded when the interest rate was below 7 percent ," is a(n)

Ceteris paribus, if the Fed reduces the discount rate, then:

A. The incentive to borrow funds increases. B. Required reserves decrease. C. The money multiplier increases. D. Total reserves decrease.

According to the textbook, for most goods and services-foods, beverages, entertainment, etc.-the income elasticity of demand is:

A. larger in the short run than in the long run. B. larger in the long run than in the short run. C. about the same in the short run and in the long run. D. is difficult to differentiate from the short run to the long run.