The discount window is a:
A. lending facility that banks can use at specified times to borrow reserves needed to meet reserve requirements.
B. term used for when large banks offer a lower interest rate for attracting more borrowers.
C. lending facility that allows any bank to borrow reserves from the Fed.
D. term used for large banking transactions that are associated with lower risk, and therefore qualify for lower interest rates.
Answer: C
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According to the text, which of the following factors may make the theory of purchasing power parity unrealistic?
A) Purchasing power parity works only with traded goods. B) Trading countries may stop exchanging goods once prices between them equalize. C) Shipping, insurance, and transaction costs may reduce the implication of purchasing power parity. D) Prices may not equalize if goods arbitrage is reduced by trade barriers. E) The effects of purchasing power parity may not show up until many years have passed.
Dumping refers to a country selling its exports at a price lower than its selling price at home.
Answer the following statement true (T) or false (F)
What happens to the AD curve when firms initially have a low level of physical capital?
What will be an ideal response?
A country can shift the production possibilities curve outward by ______.
a. discouraging entrepreneurial activity b. decreasing its population growth rate c. raising the standard of living d. improving and increasing its capital