According to the theory of liquidity preference,
a. if the interest rate is below the equilibrium level, then the quantity of money people want to hold is less than the quantity of money the Fed has created.
b. if the interest rate is above the equilibrium level, then the quantity of money people want to hold is greater than the quantity of money the Fed has created.
c. the demand for money is represented by a downward-sloping line on a supply-and-demand graph.
d. All of the above are correct.
c
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The ability of an individual, firm, or country to produce more of a certain good than other competing producers, given the same amount of resources, is referred to as:
A) marginal advantage. B) comparative disadvantage. C) absolute advantage. D) perfect advantage.
Stabilization policy is policy that seeks to
A) get zero inflation. B) eliminate fluctuations. C) eradicate unemployment. D) maximize output.