Suppose the Fed decreases the money supply. In response households and firms will ________ short term assets and this will drive ________ interest rates

Assume perfect capital mobility. Under a fixed exchange rate system, expansionary fiscal policy causes the value of the dollar to _____, while expansionary monetary policy causes the value of the dollar to _____

a. rise; rise b. fall; fall c. fall; rise d. rise; fall

If bargaining is costless and an externality exists:

a. an efficient outcome may be reached depending on which party is assigned property rights. b. an efficient outcome will be reached regardless of which party is assigned property rights. c. an efficient outcome will not be reached without government intervention. d. an efficient outcome can never be reached.