"The fewer the number of substitutes for a good, the more elastic the demand for that good." Is the previous statement true or false?
What will be an ideal response?
The statement is false. The greater the number of substitutes, the more elastic the demand for that product. Conversely, the fewer the number of substitutes, the less elastic (the more inelastic) the demand for that product.
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If the Fed sells bonds, we should expect to see the money supply
a. decrease, the interest rate increase, autonomous consumption decrease, business investment decrease, and real GDP decrease b. increase, the interest rate decrease, autonomous consumption decrease, business investment decrease, and real GDP decrease c. increase, the interest rate decrease, autonomous consumption increase, business investment increase, and real GDP increase d. decrease, the interest rate decrease, autonomous consumption increase, business investment increase, and real GDP decrease e. decrease, the interest rate increase, autonomous consumption increase, business investment increase, and real GDP increase
Unanticipated expansionary monetary policy will increase economic growth and push inflation upward while lowering real interest rates. This will cause
a. an increase in the demand for foreign currencies and a decline in the foreign exchange value of the dollar. b. a decrease in the demand for foreign currencies and a decline in the foreign exchange value of the dollar. c. an increase in the demand for foreign currencies and an increase in the foreign exchange value of the dollar. d. a decrease in the demand for foreign currencies and an increase in the foreign exchange value of the dollar.