Which of the following is an unconventional monetary policy?
a. lending to banks in unprecedented volume
b. lending to companies other than banks
c. reducing the federal funds rate to zero
d. All of these are unconventional monetary policies.
d
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If an increase in income results in a decrease in the quantity demanded of a good, then for that good, the
a. cross-price elasticity of demand is negative. b. price elasticity of demand is elastic. c. income elasticity of demand is negative. d. income elasticity of demand is positive.
Which of the following policies would be most effective in the flat part of the SRAS demand curve?
a. The Fed decreases the money supply by 3 percent. b. The Fed decreases the money supply by 10 percent. c. The Fed increases the money supply by 3 percent. d. The Fed increases the money supply by 10 percent.