Author Question: Because Federal Reserve Notes (paper currency) are legal tender A) U.S. creditors must accept ... (Read 18 times)

panfilo · **on:** Jun 29, 2018

Because Federal Reserve Notes (paper currency) are legal tender

A) U.S. creditors must accept them in payment of debts.
B) U.S. workers must accept them as payment for labor services.
C) U.S. firms must accept them as payment for goods and services.
D) All of he above are correct.

Question 2

When the Federal Reserve decreases the money supply, at the previous equilibrium interest rate households and firms will now want to

A) sell Treasury bills. B) hold less money.
C) neither buy nor sell Treasury bills. D) buy Treasury bills.