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Solutions for Chapter 17: Money Creation, Federal Reserve, Monetary Policy

Full solutions for Contemporary Economics | 2nd Edition

ISBN: 9780538444958

Solutions for Chapter 17: Money Creation, Federal Reserve, Monetary Policy

Solutions for Chapter 17
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Textbook: Contemporary Economics
Edition: 2
Author: William A. McEachern
ISBN: 9780538444958

This textbook survival guide was created for the textbook: Contemporary Economics, edition: 2. This expansive textbook survival guide covers the following chapters and their solutions. Contemporary Economics was written by and is associated to the ISBN: 9780538444958. Chapter 17: Money Creation, Federal Reserve, Monetary Policy includes 35 full step-by-step solutions. Since 35 problems in chapter 17: Money Creation, Federal Reserve, Monetary Policy have been answered, more than 4947 students have viewed full step-by-step solutions from this chapter.

Key Business Terms and definitions covered in this textbook
  • aggregate-supply curve

    a curve that shows the quantity of goods and services that firms choose to produce and sell at each price level

  • bank capital

    the resources a bank’s owners have put into the institution

  • explicit costs

    input costs that require an outlay of money by the firm

  • Fisher effect

    the one-for-one adjustment of the nominal interest rate to the inflation rate

  • imports

    goods produced abroad and sold domestically

  • internalizing the externality

    altering incentives so that people take account of the external effects of their actions

  • job search

    the process by which workers find appropriate jobs given their tastes and skills

  • law of supply and demand

    the claim that the price of any good adjusts to bring the quantity supplied and the quantity demanded for that good into balance

  • marginal change

    a small incremental adjustment to a plan of action

  • market economy

    an economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services

  • moral hazard

    the tendency of a person who is imperfectly monitored to engage in dishonest or otherwise undesirable behavior

  • nominal interest rate

    the interest rate as usually reported without a correction for the effects of inflation

  • nominal variables

    variables measured in monetary units

  • price elasticity of demand

    a measure of how much the quantity demanded of a good responds to a change in the price of that good, computed as the percentage change in quantity demanded divided by the percentage change in price

  • public goods

    goods that are neither excludable nor rival in consumption

  • signaling

    an action taken by an informed party to reveal private information to an uninformed party

  • store of value

    an item that people can use to transfer purchasing power from the present to the future

  • substitution effect

    the change in consumption that results when a price change moves the consumer along a given indifference curve to a point with a new marginal rate of substitution

  • supply curve

    a graph of the relationship between the price of a good and the quantity supplied

  • variable costs

    costs that vary with the quantity of output produced

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