All else constant, a decrease in the supply of money will lead to
A) an increase in the equilibrium quantity of money and an increase in the equilibrium price of bonds.
B) an increase in the equilibrium quantity of money and a decrease in the equilibrium price of bonds.
C) a decrease in the equilibrium quantity of money and an increase in the equilibrium price of bonds.
D) a decrease in the equilibrium quantity of money and a decrease in the equilibrium price of bonds
Ans: D) a decrease in the equilibrium quantity of money and a decrease in the equilibrium price of bonds
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An expansionary monetary policy results in lower interest rates, which in turn
A) reduces the international price of the dollar and increases net exports. B) increases the foreign demand for U.S. financial instruments, lowering the international price of the dollar and decreasing net exports. C) reduces the foreign demand for U.S. financial instruments and reduce net exports. D) increases foreign demand for U.S. financial instruments, raising the international price of the dollar and reducing net exports.
Agraria uses bushels of wheat to quote prices. In this case, bushels of wheat act as a
a. medium of exchange. b. store of value. c. commodity value. d. unit of account.