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25) Which one of the following statements is the most accurate? A) A decrease in the money supply lowers the interest rate while an increase

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25) Which one of the following statements is the most accurate? A) A decrease in the money supply lowers the interest rate while an increase in the money supply raises the interest rate, given the price level and output. B) An increase in the money supply lower the interest rate while a fall in the money supply raises the interest rate, given the price level. C) An increase in the money supply lowers the interest rate while a fall in the money supply raises the interest rate, given the output level. D) An increase in the money supply lowers the interest rate while a fall in the money supply raises the interest rate, given the price level and output E) None of the above. 26) The money supply schedule is A) horizontal because MS is set by the central bank while P is taken as given B) horizontal because MS is set by the central bank. C) vertical because MS is set by the households and firms while P is taken as given D) vertical because MS and P are set by the central bank. E) vertical because MS is set by the central bank while Pis taken as given. 27) An increase in a country's money supply causes A) its currency to appreciate in the foreign exchange market while a reduction in the money supply causes its currency to depreciate B) its currency to depreciate in the foreign exchange market while a reduction in the money supply causes its currency to appreciate C) no effect on the values of it currency in international markets. D) its currency to depreciate in the foreign exchange market while a reduction in the money supply causes its currency to further depreciate E) None of the above 28) Given us and Yus. A) An increase in the European money supply causes the cure to appreciate against the dollar bu it does not disturb the U.S. money market equilibrium. B) An increase in the European money supply causes the curo to appreciate against the dollar, and it creates excess demand for dollars in the U.S. money market. C) An increase in the European money supply causes the euro to depreciate against the dollar, and it creates excess demand for dollars in the U.S. money market. D) An increase in the European money supply causes the euro te depreciate against the dollar, bu it does not disturb the U.S. money market equilibrium. E) None of the above. 25) Which one of the following statements is the most accurate? A) A decrease in the money supply lowers the interest rate while an increase in the money supply raises the interest rate, given the price level and output. B) An increase in the money supply lower the interest rate while a fall in the money supply raises the interest rate, given the price level. C) An increase in the money supply lowers the interest rate while a fall in the money supply raises the interest rate, given the output level. D) An increase in the money supply lowers the interest rate while a fall in the money supply raises the interest rate, given the price level and output E) None of the above. 26) The money supply schedule is A) horizontal because MS is set by the central bank while P is taken as given B) horizontal because MS is set by the central bank. C) vertical because MS is set by the households and firms while P is taken as given D) vertical because MS and P are set by the central bank. E) vertical because MS is set by the central bank while Pis taken as given. 27) An increase in a country's money supply causes A) its currency to appreciate in the foreign exchange market while a reduction in the money supply causes its currency to depreciate B) its currency to depreciate in the foreign exchange market while a reduction in the money supply causes its currency to appreciate C) no effect on the values of it currency in international markets. D) its currency to depreciate in the foreign exchange market while a reduction in the money supply causes its currency to further depreciate E) None of the above 28) Given us and Yus. A) An increase in the European money supply causes the cure to appreciate against the dollar bu it does not disturb the U.S. money market equilibrium. B) An increase in the European money supply causes the curo to appreciate against the dollar, and it creates excess demand for dollars in the U.S. money market. C) An increase in the European money supply causes the euro to depreciate against the dollar, and it creates excess demand for dollars in the U.S. money market. D) An increase in the European money supply causes the euro te depreciate against the dollar, bu it does not disturb the U.S. money market equilibrium. E) None of the above

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