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Increasing the money supply leads to economic growth in the long run
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- Contractionary monetary policy by the Fed can be hampered byA.the ability of U.S. citizens and businesses to obtain dollars from foreign sources.B.the inability of U.S. citizens to hold U.S. bank accounts denominated in foreign currencies.C.international banking restrictions regulated by the International Monetary Fund.D.the increased isolation of central banks around the world.
- Refer to the figure. If the current interest rate is 2 percent,1)the interest rate will rise.2)the money demand curve will shift right.3)there is an excess supply of money.4)All of the above are correct.
- Which of the following is a possible explanation for sticky prices?A.Lack of union power to lower prices on products allows firms to maintain higher priced goods.B.It is illegal for firms to lower prices without the consent of the courts.C.Labor contracts cause wages to be fixed over the contract period.D.All firms act as a cartel and maintain a constant non-competitive price.