Short-term interest rates are expected to fall.
Short-term interest rates are expected to rise.
If the expected gains on stocks rise, while the expected returns on bonds do not change, then
the demand curve for bonds will shift to the right.
the equilibrium interest rate will rise.
the supply curve for loanable funds will shift to the right.
the equilibrium interest rate will fall.
Which of the following is a liability of the Fed?
discount loans to banks
checkable deposits in commercial banks
U.S. government securities
currency in circulation
When a central bank buys foreign assets,
the composition of its liabilities changes, but its assets are una±ected.
the composition of its assets changes, but its liabilities are una±ected.
its assets and liabilities rise by the same amount.
its assets and liabilities fall by the same amount.
The theory of purchasing power parity cannot fully explain exchange rate movements because
some goods are not traded between countries.
all goods are identical even if produced in di±erent countries.