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Questions and Answers
What is the primary consequence of a significant increase in the money supply in an economy?
What is the main component of the M1 money supply?
What is the primary purpose of open market operations?
What is the main source of revenue for banks?
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What are excess reserves in banking?
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What is the discount rate in banking?
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What is the interest rate that the Federal Reserve charges commercial banks and other financial institutions for?
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What is the general idea behind the quote from Milton and Rose Friedman?
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What does an increase in the nominal rate of interest tend to do?
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What happens to the opportunity cost of holding money when interest rates decrease?
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What are the factors that influence the demand for money?
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What happens to the demand for money when income and interest rates rise?
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What would be the short-run effect of the Federal Reserve increasing its bond purchases?
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What is the potential effect of an increase in the money supply?
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What would the Federal Reserve most likely do in the event of a recession?
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When would an expansionary monetary policy most likely increase real output?
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What is the primary cause of inflation?
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What is the velocity of money?
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What is the primary objective of rational choice decision-making?
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What is the opportunity cost of choosing a particular option?
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What does a demand schedule indicate?
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What is the law of demand?
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What is consumer surplus?
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What causes a shift in the demand curve?
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What is the result of subtracting total costs from total revenue in a business or economic activity?
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What is a characteristic of entrepreneurs?
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What happens to the price of a product when there is a surplus in the market?
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What is a necessary condition for market equilibrium and market efficiency to be consistent?
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What may lead to changes in the quantity demanded for certain products?
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