Author Question: In the medium run, a reduction in inflation causes A) a reduction in the opportunity cost of ... (Read 139 times)

Brittanyd9008 · **on:** Jun 30, 2018

In the medium run, a reduction in inflation causes

A) a reduction in the opportunity cost of holding money.
B) an increase in the opportunity cost of holding money.
C) no change in the opportunity cost of holding money.
D) individuals to switch from holding money to bonds and reduce their real money balances.

Question 2

Which of the following is not correct about quantitative easing?

A) It is one of the conventional monetary policy tools.
B) It refers to the Fed's asset purchasing program.
C) It helped reduce term premium on long-term government bonds.
D) As a result, the balance sheet of the Fed is much larger than it was before the crisis.