Everything Else Held Constant,the Vertical Section of the Supply Curve

question 57

Multiple Choice

Everything else held constant,the vertical section of the supply curve of reserves is shortened when the

• A)discount rate increases.
• B)discount rate decreases.
• C)federal funds rate rises.
• D)federal funds rate falls.

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Definitions:

Composition

The process of combining two functions by applying one function to the results of another.

Function

A relation between sets that assigns to each element of a set exactly one element of another set.

Composition

The process of combining two functions in such a way that the output of one function becomes the input of another.

Function

A relation between a set of inputs and a set of permissible outputs, often defined by an equation.