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

question 109

Multiple Choice

Everything else held constant,the vertical section of the supply curve of reserves is lengthened 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:

Marginal Rate of Substitution

The ratio at which a consumer can exchange quantities of one good for another while preserving the same degree of contentment.

Pareto Optimal

Pareto optimal is a state of allocation of resources in which it is impossible to make any one individual better off without making at least one individual worse off.

Smelted

The process of extracting a metal from its ore by heating and melting, often involving a chemical reduction reaction.

Carload

A shipping term used to indicate the minimum quantity of cargo necessary for goods to be shipped at a carload rate, typically pertaining to rail transport.