Answers to Midterm #2

 

There were 4 versions of the exam. Below find the question that is the same as the first question on your version of the test. The correct answers are listed below the question as well as the chapter that the question concerns.

 

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____ 1. In 2000 in the United Kingdom, the adult population was about 46.5 million, the labor force participation rate was 63.5 percent, and the unemployment rate was 5.8 percent. What was the number of people employed and the number of people unemployed?

1. ANS: B
about 27.8 million and 1.7 million.

DIF: 3 REF: SECTION: 15.1 OBJ: TYPE: M

2. ANS: C
an increase in the price level but does not change real GDP.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

3. ANS: D
Velocity is 8 and the price level is 4.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

4. ANS: D
All of the above are correct.

DIF: 1 REF: SECTION: 20.3 OBJ: TYPE: M

5. ANS: C
increases, reducing wages in industries that are not unionized.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

6. ANS: D
believed that $5.00 a day would increase worker productivity.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

7. ANS: C
fall, making aggregate demand shift left.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M

8. ANS: A
the longer the duration of each spell of unemployment, and the higher the unemployment rate.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

9. ANS: C
falls, shifting aggregate supply right.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

10. ANS: A
aggregate supply left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

11. ANS: D
those assets regularly used to buy goods and services.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

12. ANS: A
menu costs.

DIF: 1 REF: SECTION: 17.2 OBJ: TYPE: M

13. ANS: A
the money supply is greater than money demand.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

14. ANS: C
the equilibrium value of money decreases.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

15. ANS: B DIF: 1 REF: SECTION: 16.2
OBJ: TYPE: M

16. ANS: D
smaller but more liquid than M2.

DIF: 2 REF: SECTION: 16.1 OBJ: TYPE: M

17. ANS: C
the FOMC

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

18. ANS: D
$6667.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

19. ANS: B
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

20. ANS: C
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

21. ANS: B
0 and if the minimum wage is $6 it is 0.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

22. ANS: B
about 90 and currently is about 75.

DIF: 2 REF: SECTION: 15.1 OBJ: TYPE: M

23. ANS: D
None of the above is correct.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

24. ANS: A
year-to-year fluctuations of unemployment around its natural rate.

DIF: 1 REF: SECTION: 15.0 OBJ: TYPE: M

25. ANS: A
would increase.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

26. ANS: B
has excess reserves of less than $15,000.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

27. ANS: C
(P Y)/M.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

28. ANS: C
imposes a tax on everyone who holds money.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

29. ANS: D
rise and output falls.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

30. ANS: C
reduce the incentive to shirk.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

31. ANS: B
fell from about one-third to one-sixth of the labor force.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

32. ANS: A
Short-run aggregate supply shifts right.

DIF: 2 REF: SECTION: 20.5 OBJ: TYPE: M

33. ANS: C
regulate banks in their districts.

DIF: 1 REF: SECTION: 16.,2 OBJ: TYPE: M

34. ANS: A
increases the money supply.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M

35. ANS: C
neither M1 nor M2.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

36. ANS: B
is determined by the things that determine output in the classical model.

DIF: 1 REF: SECTION: 20.4 OBJ: TYPE: M

37. ANS: A
the short-run aggregate supply curve shifts to the left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

38. ANS: B
conducts open market operations.

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

39. ANS: C
rises, and so the price level falls.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

40. ANS: B
the real interest rate would be greater than the nominal interest rate.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

41. ANS: B
the discount rate.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

42. ANS: C
The Internet provides more readily available information about available jobs.

DIF: 2 REF: SECTION: 15.6 OBJ: TYPE: M

43. ANS: B
neither employed nor part of the labor force.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

44. ANS: B
decrease and the money supply decreases.

DIF: 2 REF: SECTION: 16.3 OBJ: TYPE: M

45. ANS: B
number of people employed plus the number of people unemployed.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

46. ANS: B
it buys Treasury securities, which increases the money supply.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

47. ANS: D
makes the price level fall, while increases in the money supply make prices rise.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

48. ANS: A
small part of real GDP, yet it accounts for a large share of the fluctuation in real GDP.

DIF: 1 REF: SECTION: 20.1 OBJ: TYPE: M

49. ANS: A
falls, so employment rises.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

50. ANS: B
classical dichotomy.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

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____ 1. Which of the following is included in the aggregate demand for goods and services?

 

1. ANS: D
All of the above are correct.

DIF: 1 REF: SECTION: 20.3 OBJ: TYPE: M

2. ANS: D
year-to-year fluctuations of unemployment around its natural rate.

DIF: 1 REF: SECTION: 15.0 OBJ: TYPE: M

3. ANS: A
the discount rate.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

4. ANS: A
neither M1 nor M2.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

5. ANS: A
an increase in the price level but does not change real GDP.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

6. ANS: A DIF: 1 REF: SECTION: 16.2
OBJ: TYPE: M

7. ANS: D
reduce the incentive to shirk.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

8. ANS: B
Short-run aggregate supply shifts right.

DIF: 2 REF: SECTION: 20.5 OBJ: TYPE: M

9. ANS: A
$6667.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

10. ANS: A
it buys Treasury securities, which increases the money supply.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

11. ANS: B
rises, and so the price level falls.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

12. ANS: D
fall, making aggregate demand shift left.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M

13. ANS: A
regulate banks in their districts.

DIF: 1 REF: SECTION: 16.,2 OBJ: TYPE: M

14. ANS: C
about 27.8 million and 1.7 million.

DIF: 3 REF: SECTION: 15.1 OBJ: TYPE: M

15. ANS: C
makes the price level fall, while increases in the money supply make prices rise.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

16. ANS: A
imposes a tax on everyone who holds money.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

17. ANS: B
the short-run aggregate supply curve shifts to the left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

18. ANS: D
about 90 and currently is about 75.

DIF: 2 REF: SECTION: 15.1 OBJ: TYPE: M

19. ANS: C
fell from about one-third to one-sixth of the labor force.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

20. ANS: D
None of the above is correct.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

21. ANS: C
has excess reserves of less than $15,000.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

22. ANS: A
aggregate supply left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

23. ANS: A
is determined by the things that determine output in the classical model.

DIF: 1 REF: SECTION: 20.4 OBJ: TYPE: M

24. ANS: B
the real interest rate would be greater than the nominal interest rate.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

25. ANS: D
smaller but more liquid than M2.

DIF: 2 REF: SECTION: 16.1 OBJ: TYPE: M

26. ANS: B
rise and output falls.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

27. ANS: B
those assets regularly used to buy goods and services.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

28. ANS: B
the money supply is greater than money demand.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

29. ANS: D
the equilibrium value of money decreases.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

30. ANS: B
The Internet provides more readily available information about available jobs.

DIF: 2 REF: SECTION: 15.6 OBJ: TYPE: M

31. ANS: B
the longer the duration of each spell of unemployment, and the higher the unemployment rate.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

32. ANS: A
classical dichotomy.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

33. ANS: C
falls, shifting aggregate supply right.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

34. ANS: D
menu costs.

DIF: 1 REF: SECTION: 17.2 OBJ: TYPE: M

35. ANS: B
falls, so employment rises.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

36. ANS: C
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

37. ANS: D
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

38. ANS: B
0 and if the minimum wage is $6 it is 0.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

39. ANS: A
small part of real GDP, yet it accounts for a large share of the fluctuation in real GDP.

DIF: 1 REF: SECTION: 20.1 OBJ: TYPE: M

40. ANS: A
Velocity is 8 and the price level is 4.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

41. ANS: D
decrease and the money supply decreases.

DIF: 2 REF: SECTION: 16.3 OBJ: TYPE: M

42. ANS: C
conducts open market operations.

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

43. ANS: A
increases, reducing wages in industries that are not unionized.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

44. ANS: B
(P Y)/M.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

45. ANS: C
would increase.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

46. ANS: C
the FOMC

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

47. ANS: B
neither employed nor part of the labor force.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

48. ANS: A
increases the money supply.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M

49. ANS: B
number of people employed plus the number of people unemployed.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

50. ANS: B
believed that $5.00 a day would increase worker productivity.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

 

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____ 1. Between the 1940s and today, union membership

1. ANS: A
fell from about one-third to one-sixth of the labor force.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

2. ANS: A
falls, so employment rises.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

3. ANS: C
falls, shifting aggregate supply right.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

4. ANS: A
neither employed nor part of the labor force.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

5. ANS: C
makes the price level fall, while increases in the money supply make prices rise.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

6. ANS: C
about 27.8 million and 1.7 million.

DIF: 3 REF: SECTION: 15.1 OBJ: TYPE: M

7. ANS: B
the discount rate.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

8. ANS: B
0 and if the minimum wage is $6 it is 0.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

9. ANS: D
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

10. ANS: D
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

11. ANS: A
is determined by the things that determine output in the classical model.

DIF: 1 REF: SECTION: 20.4 OBJ: TYPE: M

12. ANS: B
imposes a tax on everyone who holds money.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

13. ANS: B
those assets regularly used to buy goods and services.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

14. ANS: A
would increase.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

15. ANS: A
rises, and so the price level falls.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

16. ANS: A
it buys Treasury securities, which increases the money supply.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

17. ANS: A DIF: 1 REF: SECTION: 16.2
OBJ: TYPE: M

18. ANS: B
an increase in the price level but does not change real GDP.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

19. ANS: B
neither M1 nor M2.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

20. ANS: C
believed that $5.00 a day would increase worker productivity.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

21. ANS: A
increases, reducing wages in industries that are not unionized.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

22. ANS: A
$6667.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

23. ANS: B
the real interest rate would be greater than the nominal interest rate.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

24. ANS: C
regulate banks in their districts.

DIF: 1 REF: SECTION: 16.,2 OBJ: TYPE: M

25. ANS: A
about 90 and currently is about 75.

DIF: 2 REF: SECTION: 15.1 OBJ: TYPE: M

26. ANS: B
rise and output falls.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

27. ANS: A
the equilibrium value of money decreases.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

28. ANS: D
the money supply is greater than money demand.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

29. ANS: A
aggregate supply left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

30. ANS: A
fall, making aggregate demand shift left.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M

31. ANS: C
increases the money supply.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M

32. ANS: B
(P Y)/M.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

33. ANS: C
classical dichotomy.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

34. ANS: D
number of people employed plus the number of people unemployed.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

35. ANS: D
None of the above is correct.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

36. ANS: C
the FOMC

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

37. ANS: C
reduce the incentive to shirk.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

38. ANS: B
small part of real GDP, yet it accounts for a large share of the fluctuation in real GDP.

DIF: 1 REF: SECTION: 20.1 OBJ: TYPE: M

39. ANS: D
Short-run aggregate supply shifts right.

DIF: 2 REF: SECTION: 20.5 OBJ: TYPE: M

40. ANS: D
menu costs.

DIF: 1 REF: SECTION: 17.2 OBJ: TYPE: M

41. ANS: A
the longer the duration of each spell of unemployment, and the higher the unemployment rate.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

42. ANS: D
All of the above are correct.

DIF: 1 REF: SECTION: 20.3 OBJ: TYPE: M

43. ANS: C
The Internet provides more readily available information about available jobs.

DIF: 2 REF: SECTION: 15.6 OBJ: TYPE: M

44. ANS: C
smaller but more liquid than M2.

DIF: 2 REF: SECTION: 16.1 OBJ: TYPE: M

45. ANS: C
decrease and the money supply decreases.

DIF: 2 REF: SECTION: 16.3 OBJ: TYPE: M

46. ANS: A
conducts open market operations.

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

47. ANS: C
has excess reserves of less than $15,000.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

48. ANS: B
Velocity is 8 and the price level is 4.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

49. ANS: B
the short-run aggregate supply curve shifts to the left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

50. ANS: D
year-to-year fluctuations of unemployment around its natural rate.

DIF: 1 REF: SECTION: 15.0 OBJ: TYPE: M

 

 

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____ 1. When unions raise wages in some sectors of the economy, the supply of labor in other sectors of the economy

1. ANS: C
increases, reducing wages in industries that are not unionized.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

2. ANS: B
Short-run aggregate supply shifts right.

DIF: 2 REF: SECTION: 20.5 OBJ: TYPE: M

3. ANS: D
rise and output falls.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

4. ANS: D
Velocity is 8 and the price level is 4.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

5. ANS: A
would increase.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

6. ANS: D
makes the price level fall, while increases in the money supply make prices rise.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

7. ANS: B
the longer the duration of each spell of unemployment, and the higher the unemployment rate.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

8. ANS: B
is determined by the things that determine output in the classical model.

DIF: 1 REF: SECTION: 20.4 OBJ: TYPE: M

9. ANS: C
fell from about one-third to one-sixth of the labor force.

DIF: 2 REF: SECTION: 15.4 OBJ: TYPE: M

10. ANS: D
falls, shifting aggregate supply right.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

11. ANS: A
it buys Treasury securities, which increases the money supply.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

12. ANS: A
has excess reserves of less than $15,000.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

13. ANS: D
falls, so employment rises.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

14. ANS: A
believed that $5.00 a day would increase worker productivity.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

15. ANS: A
about 90 and currently is about 75.

DIF: 2 REF: SECTION: 15.1 OBJ: TYPE: M

16. ANS: B
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

17. ANS: A
0 and if the minimum wage is $6 it is 0.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

18. ANS: D
rise by 40.

DIF: 2 REF: SECTION: 15.3 OBJ: TYPE: M

19. ANS: D
decrease and the money supply decreases.

DIF: 2 REF: SECTION: 16.3 OBJ: TYPE: M

20. ANS: D
year-to-year fluctuations of unemployment around its natural rate.

DIF: 1 REF: SECTION: 15.0 OBJ: TYPE: M

21. ANS: B
conducts open market operations.

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

22. ANS: D
None of the above is correct.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

23. ANS: C
neither M1 nor M2.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

24. ANS: D
classical dichotomy.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

25. ANS: A
$6667.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

26. ANS: B DIF: 1 REF: SECTION: 16.2
OBJ: TYPE: M

27. ANS: A
The Internet provides more readily available information about available jobs.

DIF: 2 REF: SECTION: 15.6 OBJ: TYPE: M

28. ANS: A
those assets regularly used to buy goods and services.

DIF: 1 REF: SECTION: 16.1 OBJ: TYPE: M

29. ANS: A
menu costs.

DIF: 1 REF: SECTION: 17.2 OBJ: TYPE: M

30. ANS: A
the short-run aggregate supply curve shifts to the left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

31. ANS: A
smaller but more liquid than M2.

DIF: 2 REF: SECTION: 16.1 OBJ: TYPE: M

32. ANS: D
number of people employed plus the number of people unemployed.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

33. ANS: D
neither employed nor part of the labor force.

DIF: 1 REF: SECTION: 15.1 OBJ: TYPE: M

34. ANS: C
increases the money supply.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M

35. ANS: C
regulate banks in their districts.

DIF: 1 REF: SECTION: 16.,2 OBJ: TYPE: M

36. ANS: A
aggregate supply left.

DIF: 1 REF: SECTION: 20.5 OBJ: TYPE: M

37. ANS: C
rises, and so the price level falls.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

38. ANS: C
the discount rate.

DIF: 1 REF: SECTION: 16.3 OBJ: TYPE: M

39. ANS: C
imposes a tax on everyone who holds money.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

40. ANS: C
an increase in the price level but does not change real GDP.

DIF: 2 REF: SECTION: 20.4 OBJ: TYPE: M

41. ANS: C
(P Y)/M.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

42. ANS: A
the real interest rate would be greater than the nominal interest rate.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

43. ANS: D
All of the above are correct.

DIF: 1 REF: SECTION: 20.3 OBJ: TYPE: M

44. ANS: D
reduce the incentive to shirk.

DIF: 1 REF: SECTION: 15.5 OBJ: TYPE: M

45. ANS: B
the equilibrium value of money decreases.

DIF: 1 REF: SECTION: 17.1 OBJ: TYPE: M

46. ANS: B
the money supply is greater than money demand.

DIF: 2 REF: SECTION: 17.1 OBJ: TYPE: M

47. ANS: D
the FOMC

DIF: 1 REF: SECTION: 16.2 OBJ: TYPE: M

48. ANS: B
about 27.8 million and 1.7 million.

DIF: 3 REF: SECTION: 15.1 OBJ: TYPE: M

49. ANS: C
small part of real GDP, yet it accounts for a large share of the fluctuation in real GDP.

DIF: 1 REF: SECTION: 20.1 OBJ: TYPE: M

50. ANS: B
fall, making aggregate demand shift left.

DIF: 2 REF: SECTION: 20.3 OBJ: TYPE: M