Consumers would buy more cars, houses and other "big ticket" items that are usually bought "on time," thus shifting the AD curve to the right. businesses would purchase more capital goods because their net rate of return would increase, thus shifting the AD curve to the right Ausiness would expand operations because they become more profitable (ceteris paribus), thus shifting the AS curve to the right. all the above estion 23 is the Federal Funds Rate? he rate that the federal government pays on the bonds it sells to the public. The rate that the federal government requires banks to charge to retail customers. the rate that one bank charges to another for loans, sometimes just held overnight. the rate that the bank pays to the federal government for money it borrows from the Fed. stion 24 th of the following statements is TRUE?

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Chapter1: Making Economics Decisions
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Question 22
Use the Aggregate Demand/Aggregate Supply model to determine which of the following would happen if interest rates went down.
O Consumers would buy more cars, houses and other "big ticket" items that are usually bought "on time," thus shifting the AD curve to the right.
O Businesses would purchase more capital goods because their net rate of return would increase, thus shifting the AD curve to the right
O Business would expand operations because they become more profitable (ceteris paribus), thus shifting the AS curve to the right.
O All the above
Question 23
What is the Federal Funds Rate?
The rate that the federal government pays on the bonds it sells to the public.
O The rate that federal government requires banks to charge to retail customers.
The rate that one bank charges to another loans, sometimes just held overnight.
The rate that the bank pays to the federal government for money it borrows from the Fed
Question 24
Which of the following statements is TRUE?
When corn prices increase farmers will increase the supply of wheat
O When price of paper increases, supply for paperback books will increase
O When government gives Lipton Tea a subsidy, the supply of tea will increase
O None of the above
Question 25
Which of the following is NOT an illustration of the notion of opportunity cost
The production of more military goods means fewer resources are available to produce civilian goods.
O When a Kansas farmer plants more wheat on her land she leaves less land available to cultivate com.
If I buy a pizza, I will not be able to afford to watch a movie.
O After the pandemic the US economy is able to increase production of capital goods and consumer goods as well
Question 26
The most fundamental economic problem in any economy is:
O National security
Universal healthcare
O Scarcity
O Creative Destruction
Transcribed Image Text:Question 22 Use the Aggregate Demand/Aggregate Supply model to determine which of the following would happen if interest rates went down. O Consumers would buy more cars, houses and other "big ticket" items that are usually bought "on time," thus shifting the AD curve to the right. O Businesses would purchase more capital goods because their net rate of return would increase, thus shifting the AD curve to the right O Business would expand operations because they become more profitable (ceteris paribus), thus shifting the AS curve to the right. O All the above Question 23 What is the Federal Funds Rate? The rate that the federal government pays on the bonds it sells to the public. O The rate that federal government requires banks to charge to retail customers. The rate that one bank charges to another loans, sometimes just held overnight. The rate that the bank pays to the federal government for money it borrows from the Fed Question 24 Which of the following statements is TRUE? When corn prices increase farmers will increase the supply of wheat O When price of paper increases, supply for paperback books will increase O When government gives Lipton Tea a subsidy, the supply of tea will increase O None of the above Question 25 Which of the following is NOT an illustration of the notion of opportunity cost The production of more military goods means fewer resources are available to produce civilian goods. O When a Kansas farmer plants more wheat on her land she leaves less land available to cultivate com. If I buy a pizza, I will not be able to afford to watch a movie. O After the pandemic the US economy is able to increase production of capital goods and consumer goods as well Question 26 The most fundamental economic problem in any economy is: O National security Universal healthcare O Scarcity O Creative Destruction
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