Exam 15: Monetary Theory and Policy in an Open Economy

Suppose there is an increase in the money supply, with velocity and real GDP constant.According to the equation of exchange, which of the following variables will likely increase?

(Multiple Choice)

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Question 21

Exhibit 14-1 -Refer to the graph in the exhibit.Suppose there is an increase in level of GDP.What will this increase cause?

(Multiple Choice)

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Question 22

Which of the following actions might the Bank of Canada take in order to close a recessionary gap?

(Multiple Choice)

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Question 23

Suppose the Bank of Canada wants to stimulate the economy.Which of the following strategies might the Bank use?

(Multiple Choice)

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Question 24

According to the equation of exchange, what does the quantity of money multiplied by the velocity of money equal?

(Multiple Choice)

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Question 25

What type of relationship exists between the interest rate and the quantity of money demanded?

(Multiple Choice)

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Question 26

Suppose the economy's real output grows at an average rate of 3 percent per year.And suppose there is a 7 percent average rate of growth in the money supply, and velocity is constant.How would the inflation rate be affected?

(Multiple Choice)

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Question 27

How does the demand for money vary with price level and real GDP?

(Multiple Choice)

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Question 28

When would an increase in aggregate demand have a small long-run effect on real GDP?

(Multiple Choice)

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Question 29

What would be the ultimate effect of a reduction in the money supply?

(Multiple Choice)

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Question 30

How will a monetary injection by the Bank of Canada affect interest rates and aggregate demand?

(Multiple Choice)

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Question 31

What is the effect of an expansionary monetary policy on the demand for investment curve?

(Multiple Choice)

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Question 32

What does a vertical supply curve of money indicate?

(Multiple Choice)

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Question 33

How is the velocity of money defined?

(Multiple Choice)

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Question 34

If the demand for money increases, how will the money demand curve be affected?

(Multiple Choice)

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Question 35

For interest rates to remain stable during economic expansions, what should happen to the growth rate of the money supply in relation to the demand for money?

(Multiple Choice)

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Question 36

What is the equation of exchange?

(Multiple Choice)

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Question 37

According to the equation of exchange, what are increases in the money supply translated into?

(Multiple Choice)

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Question 38

What is the equation of exchange?

(Multiple Choice)

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Question 39

Suppose the economy's velocity is constant and real output grows at an average rate of 4 percent per year.What would be the result of a 4 percent average rate of growth in the money supply?

(Multiple Choice)

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Question 40

Showing 21 - 40 of 130

Suppose there is an increase in the money supply, with velocity and real GDP constant.According to the equation of exchange, which of the following variables will likely increase?

Exhibit 14-1 -Refer to the graph in the exhibit.Suppose there is an increase in level of GDP.What will this increase cause?

Which of the following actions might the Bank of Canada take in order to close a recessionary gap?

Suppose the Bank of Canada wants to stimulate the economy.Which of the following strategies might the Bank use?

According to the equation of exchange, what does the quantity of money multiplied by the velocity of money equal?

What type of relationship exists between the interest rate and the quantity of money demanded?

Suppose the economy's real output grows at an average rate of 3 percent per year.And suppose there is a 7 percent average rate of growth in the money supply, and velocity is constant.How would the inflation rate be affected?

How does the demand for money vary with price level and real GDP?

When would an increase in aggregate demand have a small long-run effect on real GDP?

What would be the ultimate effect of a reduction in the money supply?

How will a monetary injection by the Bank of Canada affect interest rates and aggregate demand?

What is the effect of an expansionary monetary policy on the demand for investment curve?

What does a vertical supply curve of money indicate?

How is the velocity of money defined?

If the demand for money increases, how will the money demand curve be affected?

For interest rates to remain stable during economic expansions, what should happen to the growth rate of the money supply in relation to the demand for money?

What is the equation of exchange?

According to the equation of exchange, what are increases in the money supply translated into?

What is the equation of exchange?

Suppose the economy's velocity is constant and real output grows at an average rate of 4 percent per year.What would be the result of a 4 percent average rate of growth in the money supply?

The Art and Science of Economic Analysis

Economic Tools and Economic Systems

Economic Decision Makers

Demand, Supply, and Markets

Algebraic Approach to Demand, Supply, and Equilibrium

Introduction to Macroeconomics

Tracking the Canadian Economy

Unemployment and Inflation

Productivity and Growth

Aggregate Expenditure and Aggregate Demand

Aggregate Supply

Fiscal Policy

Money and the Financial System

Banking and the Money Supply

Macro Policy Debate: Active or Passive

International Finance

International Trade

Economic Development

Understanding Graphs

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