Author Question: After a loan is made, the: a. M2 money supply rises until the loan is repaid. b. M2 money supply ... (Read 44 times)

mmm

  • Hero Member
  • *****
  • Posts: 558
After a loan is made, the:
 a. M2 money supply rises until the loan is repaid.
  b. M2 money supply rises until the loan is spent.
  c. M2 money supply rises until the loan is cleared.
  d. M2 money supply does not change until the loan is spent.
  e. M2 money supply does not change until the loan is cleared.

Question 2

Assume that the government increases spending and finances the expenditures by borrowing in the domestic capital markets. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the real risk-free interest rate and real GDP in the context of the Three-Sector-Model?
 a. The real risk-free interest rate rises and real GDP rises.
  b. The real risk-free interest rate falls, and real GDP rises.
  c. The real risk-free interest rate rises, and real GDP falls.
  d. The real risk-free interest rate and real GDP remain the same.
  e. There is not enough information to determine what happens to these two macroeconomic variables.



honnalora

  • Sr. Member
  • ****
  • Posts: 325
Answer to Question 1

.A

Answer to Question 2

.A



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Limit intake of red meat and dairy products made with whole milk. Choose skim milk, low-fat or fat-free dairy products. Limit fried food. Use healthy oils when cooking.

Did you know?

Blood is approximately twice as thick as water because of the cells and other components found in it.

Did you know?

When Gabriel Fahrenheit invented the first mercury thermometer, he called "zero degrees" the lowest temperature he was able to attain with a mixture of ice and salt. For the upper point of his scale, he used 96°, which he measured as normal human body temperature (we know it to be 98.6° today because of more accurate thermometers).

Did you know?

The calories found in one piece of cherry cheesecake could light a 60-watt light bulb for 1.5 hours.

Did you know?

Acute bronchitis is an inflammation of the breathing tubes (bronchi), which causes increased mucus production and other changes. It is usually caused by bacteria or viruses, can be serious in people who have pulmonary or cardiac diseases, and can lead to pneumonia.

For a complete list of videos, visit our video library