Unlike demand, the longer the time suppliers have to respond to a change in price, the less elastic is the supply curve.
a. True
b. False
Indicate whether the statement is true or false
Question 2
If the Federal Open Market Committee (FOMC) decides to expand the money supply, then:
a. it will issue directions to sell U.S. government securities, thus increasing the velocity of circulation of the money supply.
b. it will issue directions to purchase U.S. government securities, thus putting more reserves in the hands of banks.
c. it will order new Federal Reserve notes delivered to member banks.
d. it will raise the discount rate to member banks.
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