If there is an excess supply of money, there is an excess
a. demand for bonds and the price of bonds will decrease
b. supply of bonds and the price of bonds will decrease
c. supply of bonds but the price of bonds will not change
d. supply of bonds and the price of bonds will increase
e. demand for bonds and the price of bonds will increase
E
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If the Fed chooses to target the money supply, it
a. cannot at the same time control the interest rate b. can only do so if the interest rate is targeted as well c. gives up the opportunity of determining the legal reserve requirement d. gives up the opportunity of determining the discount rate e. gives up the opportunity of determining the federal funds rate
Which of the following situations is a clear application of the benefits principle of taxation?
a. wealthier people are taxed more heavily b. heavier vehicles are charged higher tolls on turnpikes c. state government providing a free education to any child in the state d. sales of measles vaccine exempt from sales tax