Author Question: Uncertainty may cause banks to hold larger excess reserves. Other things being constant, this will: ... (Read 106 times)

penza · **on:** Jun 30, 2018

Uncertainty may cause banks to hold larger excess reserves. Other things being constant, this will:
a. have no effect on the volume of loans or the money supply.
b. tend to reduce both the volume of loans and the money supply.
c. tend to increase both the volume of loans and the money supply.
d. tend to increase the volume of loans but reduce the money supply.

Question 2

Monetarists believe that in the short run:
a. the natural rate of unemployment cannot be changed.
b. expansionary monetary policy is ineffective in raising real GDP.
c. a change in the money supply is fully reflected in a change in the interest level.
d. contractionary monetary policy will decrease unemployment.
e. there is a tradeoff between unemployment and inflation.