6-9 please III. True/False – Explain:1) According to Walras Law excess demand in the money market would also beassociated with an excess demand for bonds.2) When the Fed lowers the discount rate the money supply might or might notincrease.3) The money multiplier has changed dramatically in the last few years because ofsignificant changes in s.4) The federal funds rate is an interest rate that the Fed directly controls.5) An expansionary monetary shock leads to a net decrease in investment becauseof monetary feedback.6) Fiscal crowd-out can be avoided by decreasing M when expansionary fiscalshocks are implemented.7) Banks with excess reserves can potentially create DDs in excess of their level ofexcess reserves.8) The money supply in the United States has increased dramatically in the lastfew years because the money multiplier has significantly increased.9) Fiscal policy is more effective when money demand is very responsive tointerest rate changes.

Note: We are answering the first question out of 6-9 as the exact one was not specified. Please…

Answered: 6) Fiscal crowd-out can be avoided by…

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Economics

6) Fiscal crowd-out can be avoided by decreasing M when expansionary fiscal shocks are implemented.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

6-9 please

III. True/False – Explain:
1) According to Walras Law excess demand in the money market would also be
associated with an excess demand for bonds.
2) When the Fed lowers the discount rate the money supply might or might not
increase.
3) The money multiplier has changed dramatically in the last few years because of
significant changes in s.
4) The federal funds rate is an interest rate that the Fed directly controls.
5) An expansionary monetary shock leads to a net decrease in investment because
of monetary feedback.
6) Fiscal crowd-out can be avoided by decreasing M when expansionary fiscal
shocks are implemented.
7) Banks with excess reserves can potentially create DDs in excess of their level of
excess reserves.
8) The money supply in the United States has increased dramatically in the last
few years because the money multiplier has significantly increased.
9) Fiscal policy is more effective when money demand is very responsive to
interest rate changes.

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