Both ________ and ________ are Federal Reserve assets. A) currency in circulation; reserves B) currency in circulation; securities C) securities; loans to financial institutions D) securities; reserves ANSWER C
Date: September 10th, 2020
Everything else held constant, a decrease in government spending will cause the IS curve to shift to the ________ and aggregate demand will ________. A) right; increase B) right; decrease C) left; increase D) left; decrease ANSWER D
Date: September 10th, 2020
An adverse oil price increase will shift the short-run aggregate supply curve: A) leftward. B) rightward. C) will not shift. D) none of the above. ANSWER A
Date: September 10th, 2020
The yield to maturity for a perpetuity is a useful approximation for the yield to maturity on long-term coupon bonds. It is called the ________ when approximating the yield for a coupon bond. A) current yield B) discount yield C) future yield D) star yield ANSWER A
Date: September 10th, 2020
In the short run, a firm can minimize its total costs of production by operating at the minimum of its average total cost curve. Indicate whether the statement is true or false ANSWER FALSE
Date: September 10th, 2020
Empirical evidence indicates that most firms operate where marginal and average variable costs are constant. Indicate whether the statement is true or false ANSWER TRUE
Date: September 10th, 2020
Distinguish between real and nominal GDP. Which one is a better measure of the business cycle? What will be an ideal response? ANSWER Nominal GDP is the value of currently produced final goods and services measured in current year prices. Real GDP is the value of currently produced final goods and services measured in […]
Date: September 10th, 2020
According to the Lucas critique, if past increases in the short-term interest rate have always been temporary, then A) the term-structure relationship using past data will then show only a weak effect of changes in the short-term interest rate on the long-term rate. B) the term-structure relationship using past data will show no effect of […]
Date: September 10th, 2020
Bonds that are sold in a foreign country and are denominated in the country’s currency in which they are sold are known as A) foreign bonds. B) Eurobonds. C) equity bonds. D) country bonds. ANSWER A
Date: September 10th, 2020
A consol paying $20 annually when the interest rate is 5 percent has a price of A) $100. B) $200. C) $400. D) $800. ANSWER C
Date: September 10th, 2020
