Based on the Given Table, an Increase in the Money

question 174

Multiple Choice

Based on the given table, an increase in the money supply of $20 billion will cause the equilibrium interest rate to

• A)fall by 4 percentage points.
• B)fall by 2 percentage points.
• C)rise by 4 percentage points.
• D)rise by 2 percentage points.

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Definitions:

Labor Markets

The supply and demand for labor, where employers seek to hire workers and workers seek employment.

Contract

A legally binding agreement between parties that outlines the terms and conditions under which a transaction or exchange is to take place.

Means-Tested Programs

Government programs and assistance available only to individuals or families whose income and assets fall below specified thresholds.

Consumption Tax

A tax on the purchase of goods and services, levied at the point of consumption.