A. reduce the minimum reserve asset ratio.
B. buy government securities on the open market
C. lower interest rates
D. sell government securities on the open market
Related Mcqs:
- If the state Bank of Pakistan wished to pursue an expansionary monetary policy it would ?
A. increase the minimum reserve asset ratio.
B. buy government securities on the open market
C. raise interest rates
D. sell government securities on the open market - In the early eighties, the Federal Reserve pursed a tight monetary policy. All else being equal. the impact of that policy was to interest rates in the United States relative to those in Europe and cause the dollar to _______ against European currencies?
A. decrease; depreciate
B. decrease; appreciate
C. increase; depreciate
D. increase; appreciate - Suppose the State Bank purchases a Rs 1,000 government bond from you. If you deposit the entire Rs 1,000 in you bank what is the total potential change in the money supply as a result of the State Bank’s action if the your bank’s reserve ratio is 20 percent ?
A. Rs 4,000
B. Rs 5,000
C. Rs 1,000
D. Rs 0 - Refers to Exhibit 4. Suppose the economy is operating in a recession such as point B in Exhibit 4. If policy makers wished to move output to its long run natural rate they should attempt to ?
A. Shift aggregate demand to the left
B. Shift short run aggregate supply to the left
C. shift aggregate demand to the right
D. shift short-run aggregate supply to the right - If a country’s policy makers were to continuously use expansionary monetary policy in an attempt to hold unemployment below the natural rate the long-run result would be ?
A. an increase in the level of output
B. a decrease in the unemployment rate
C. an increase in the rate of inflation
D. All of these answers - Time lags which often erode effectiveness of monetary and fiscal policy measures represent ?
A. delays in the response of the economy is stabilization policy
B. the foreign response to price changes
C. the change in exports and imports prices
D. the change in exchange rates - The implementation lag for monetary policy is generally ?
A. the same as it is for fiscal policy
B. much shorter than it is for fiscal policy
C. mush longer than it is for fiscal policy
D. unrelated to central bank action - LDCs are reluctant to pursue development through the export of primary products because of ____ and _____ ?
A. The upward trend in commodity prices the stability of primary products real prices
B. The upward trend in commodity prices, the volatility of primary products real prices
C. The downward trend in commodity prices the stability of primary products real prices
D. The downward trend in commodity prices the volatility of primary products real prices - A person will continue to pursue an activity up to the point where ?
A. Marginal benefit equals marginal damage cost
B. marginal benefits equals marginal social cost
C. marginal benefit equals marginal private cost
D. marginal social cost equals marginal external cost - Expansionary monetary policy ?
A. tends to lead to an appreciation of a nation’s currency
B. tends to lead to a depreciation of a nation’s currency
C. usually has no effect on a currency’s exchange value
D. tends to lead to a depreciation of the currencies of other nations
