Figure 26-3 -Refer to Figure 26-3.In the Figure Above,the Movement from Point

question 51

Multiple Choice

Figure 26-3

-Refer to Figure 26-3.In the figure above,the movement from point A to point B in the money market would be caused by

• A) an increase in the price level.
• B) a decrease in real GDP.
• C) an open market sale of Treasury securities by the Federal Reserve.
• D) a decrease in the required reserve ratio by the Federal Reserve.

Understand the concept of technology spillovers and their implication for government policy.

Analyze the effects of public goods and positive externalities on market outcomes.

Understand the concept of pollution permits and their role in controlling pollution levels.

Recognize the difference between equilibrium quantity and socially optimal quantity in the presence of externalities.

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Definitions:

Tool Making

The process of crafting instruments or devices manually or mechanically, which humans and some animals use to make tasks easier.

Tarsal

A group of seven bones in the foot that form the ankle and part of the arch.

Reconciliation

The process of restoring friendly relations between individuals or groups after a conflict or a period of estrangement.

Arrested Development

A state in which development has stopped prematurely, often used in psychological contexts to describe individuals or in biology to discuss growth processes.