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The consumption schedule is:A)an inverse relationship between consumption and the pricelevelB)a direct relationship between consumption and disposableincomeC)an inverse relationship between consumption and savingD)an inverse relationship between […]

Assume the banking system has no excess reserves with a reserverequirement of 20%. The reserve requirement is then dropped to 10%.As a result of this reduction:A)the […]

Along a particular saving schedule each change in disposableincome of $15 billion generates an additional $3 billion in saving.Therefore:A)the MPS is .3B)the MPS is .2C)the APC […]

A bank temporarily short of required reserves may remedy thesituation by borrowing reserves:A)in the bond marketB)in the Federal deposit marketC)from its own depositorsD)in the Federal funds […]

Other things equal a dramatic decrease in the money supplywould:A)increase the price levelB)reduce the purchasing power of each dollarC)increase the purchasing power of each dollarD)have an […]

If the current interest rate is below the equilibrium rate:A)the money supply exceeds the quantity of money demandedB)the money supply will increase and the interest rate […]

Suppose banks are just meeting their reserve requirement of 25% andthe Fed sells $30 billion in government securities to commercialbanks. The effect of this sale is […]

A decrease in the money supply will:A)raise interest rates reducing planned investment and GDPB)raise interest rates increasing planned investment and loweringGDPC)reduce interest rates increasing planned investment […]

When economists view technological change as internal tothe economy they mean that it: