1. The sale of existing U.S. Treasury securities by the Federal Reserve:
will increase the money supply.
will have no effect on the money supply.
will decrease the amount of U.S. Treasury securities held at banks.
will decrease the money supply.
will increase the reserves at banks.
2. Imagine an indifference curve graph with units of clothing on the y-axis and visits to the neighborhood pizza joint for dinner on the x-axis. If the indifference curves for this individual are negatively sloped but close to horizontal, it means
a) the marginal utility from another pizza dinner is high relative to the marginal utility of clothing.
b) the marginal utility from another pizza dinner is low relative to the marginal utility of clothing
c) this person doesn’t like pizza at all.
d) this person can spend a lot of money on clothes at times.