As part of the "wealth channel of monetary policy," a lower money supply __________ bond prices and thus __________ spending
A) raises; raises consumption
B) raises; raises investment
C) lowers; lowers consumption
D) lowers; lowers investment
C
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The distance between the demand curve and the price the consumer has to pay for a product (given quantity demanded) is referred to as:
A. market surplus. B. producer surplus. C. consumer surplus. D. market shortage.
Recall the Application about the incentives to install rooftop solar panels to answer the following question(s).According to the Application, a 10 percent increase in the tax credits for solar panels results in an increase in the number of households that install solar panels by 7.6 percent. The increase in sales due to this subsidy is an example of which element of the economic way of thinking?
A. responding to incentives B. isolating variables C. thinking at the margin D. using assumptions to simplify