Open market operations mean that the Fed is buying\selling government securities. This means that if the Fed wants to increase themoney supply, it shouldⒸBuy bonds.Sell bonds.Decrease taxes.Decrease government spendingQUESTION 7Consider the market for automobiles. Suppose consumer income decreases dramatically while simultaneously there is global shutdownthat increases the cost of producing automobiles. In this situation we would expect,Price of automobiles to fall and the quantity sold to increase.O Price of automobiles to either increase or decrease and the quantity sold to fall.Price of automobiles to fall and the quantity sold to either increase or decrease.None of the aboveQUESTION 8Which of the following is an example of an automatic stabilizer?O Increases in the interest rate.Unemployment insurance and welfare.O Automatically varying reserve requirements that differ by Federal Reserve Bank RegionB and C. What are the functions of money?Medium of exchange.Serves as a unit of account.Store of wealth.All of the above.QUESTION 10Which of the following is a role of the Federal Reserve?Conducting Monetary Policy.Supervising and regulating financial institutions.Serving as a lender of last resort to financial institutions.All of the above.QUESTION 11The buying of government bonds by the Federal Reserve manipulates aggregate demand by decreasing.and therefore increases aggregate demand.Government spending: InvestmentInterest rates; InvestmentDeficit; ExportsInterest Rates; Taxeswhich increases

As there are multiple questions so answer is provided to the first question. "Money supply in a…

Open market operations mean that the Fed is buying\selling government securities. This means that if the Fed wants to increase the money supply, it should i Buy bonds. Sell bonds. O Decrease taxes. Decrease government spending

Open market operations mean that the Fed is buying\selling government securities. This means that if the Fed wants to increase the money supply, it should i Buy bonds. Sell bonds. O Decrease taxes. Decrease government spending

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

Open market operations mean that the Fed is buying\selling government securities. This means that if the Fed wants to increase the
money supply, it should
ⒸBuy bonds.
Sell bonds.
Decrease taxes.
Decrease government spending
QUESTION 7
Consider the market for automobiles. Suppose consumer income decreases dramatically while simultaneously there is global shutdown
that increases the cost of producing automobiles. In this situation we would expect,
Price of automobiles to fall and the quantity sold to increase.
O Price of automobiles to either increase or decrease and the quantity sold to fall.
Price of automobiles to fall and the quantity sold to either increase or decrease.
None of the above
QUESTION 8
Which of the following is an example of an automatic stabilizer?
O Increases in the interest rate.
Unemployment insurance and welfare.
O Automatically varying reserve requirements that differ by Federal Reserve Bank Region
B and C.

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