The additional pleasure or satisfaction from a good declines as more of it is consumed in a given period. This is the definition of the

If money demand is extremely sensitive to changes in the interest rate, the money demand curve becomes almost horizontal. If the Fed expands the money supply under these circumstances, then the interest rate will

A) change very little and investment and consumer spending will change very little. B) rise substantially and investment and consumer spending will rise substantially. C) fall substantially and investment and consumer spending will fall substantially. D) fall substantially and investment and consumer spending will change very little.

As a result of the financial crisis of 2007-2009, the size of the shadow banking system:

A) became smaller than the commercial banking system B) became larger than the commercial banking system C) declined, but remained larger than the commercial banking system D) increased, but remained smaller than the commercial banking system