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NEW QUESTION: 1
An increase in the money supply leads to:
A. An increase in interest rates, a decrease in investment and a decrease in aggregate demand.
B. An increase in the money supply has no effect on interest rates or investment.
C. A decline in interest rates, a decrease in investment and an increase in aggregate demand.
D. A decline in interest rates, an increase in investment and an increase in aggregate demand.
Answer: D
Explanation:
Choice "a" is correct. Expansionary monetary policy results when the Fed increases the money supply.
Expansionary monetary policy affects the economy through the following chain of events:
(1) an increase in the money supply causes interest rates to fall, (2) falling interest rates stimulate the
desired levels of firm investment and household consumption, (3) increases in desired investment and
consumption cause an increase in aggregate demand, and (4) aggregate demand shifts to the right
causing real GDP and the price level to rise.
Choice "b" is incorrect. An increase in the money supply causes investment to increase, not decrease.
Choice "c" is incorrect. An increase in the money supply causes interest rates to decrease, not increase,
investment to increase, not decrease and aggregate demand to increase, not decrease.
Choice "d" is incorrect per above Explanation: .
NEW QUESTION: 2
Drag and Drop Question
Drag and drop the STP features from the left onto the correct descriptions on the right.
Answer:
Explanation:
NEW QUESTION: 3
A SOHO user has asked a technician to configure email functionality with a desktop email client. Which of the following protocols needs to be configured so the user can send email to other users?
A. ICMP
B. SMTP
C. SNMP
D. POP3
Answer: B
NEW QUESTION: 4
A. Option C
B. Option A
C. Option B
D. Option D
Answer: C
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