In the above figure, the shift in the supply curve from S to S2 reflects
A) an increase in the supply of pizza.
B) an increase in the quantity of pizza supplied.
C) a decrease in the quantity of pizza supplied.
D) a decrease in the supply of pizza.
E) a decrease in the supply of pizza and a simultaneous decrease in the quantity of pizza supplied.
A
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Increasing opportunity cost implies that
A) producing additional units of one good results in proportionately smaller reductions in the output of the other good. B) producing additional units of one good results in increasing amounts of lost output of the other good. C) the production possibilities frontier will be a straight line. D) the society will be producing inside its production possibilities frontier.
Why does the Fed have imperfect control over the money supply?
a. Because the Fed does not know how much reserves will change when it buys or sells securities. b. Because of unpredictable changes in the public's desire to hold cash and banks' desires to hold reserves. c. Because of unpredictable changes in reserve requirements. d. Because of the secrecy of FOMC meetings, which lead to policy surprises.