Suppose that the equilibrium nominal interest rate is 4 percent and the equilibrium quantity of money is $1 trillion. At any interest rate above 4 percent,
A) less than $1 trillion will be demanded and bond prices will fall.
B) more than $1 trillion will be supplied and bond prices will fall.
C) there is a shortage of money and the interest rate will rise.
D) more than $1 trillion will be supplied and the interest rate will rise.
E) less than $1 trillion will be demanded and bond prices will increase.
E
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The federal government's support of farm prices in the United States has affected the value of farm property
Indicate whether the statement is true or false
Two farmers, A and B, each apply 100 tons of manure on their fields. To reduce manure runoff, the government has decided to require a permit for each ton of manure applied. The government gives each farmer 50 permits. Farmer A incurs losses of $25 for each ton of manure he does not apply, and Farmer B incurs losses of $50 for each ton of manure he does not apply. What is the total cost of
reducing runoff if firms are not allowed to buy and sell permits from each other? What is the total cost of reducing runoff if the firms are allowed to buy and sell permits from each other? a. $3,750; $2,500 b. $2,500; $3,750 c. $5,000 . $2,500 d. $3,750; $3,750