The purpose of the commitment by the Fed to keep the federal funds rate at zero for a long period of time is to
A) lower the long term interest rates.
B) lower the short term interest rates.
C) increase the long term interest rates.
D) increase the short term interest rates.
A
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Which of the following is NOT a factor that has contributed to declining private-sector differential between union and nonunion wages in the U.S. since 1980?
A) Globalization of the production process B) Improved ability of firms to substitute capital for labor in production C) Adoption of two-tiered wage and benefit structures by unionized firms D) Declines in the unemployment and health insurance premiums paid by union workers
Which of the following would be most appropriate if the Federal Reserve wanted to increase the money supply in order to stimulate the economy?
a. buy U.S. securities b. force the Treasury to reduce the national debt c. raise the discount rate d. increase the reserve requirements