Which of the following would cause an increase in the supply of cheese?
A) a decrease in the price of wine (assuming that cheese and wine are complements)
B) an increase in the price of cheese
C) an increase the price of a product that producers sell instead of cheese
D) an increase in the number of firms that produce cheese
Answer: D
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Refer to Figure 24-1. Ceteris paribus, an increase in interest rates would be represented by a movement from
A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A.
The belief that the regulators of the U.S. financial system would not tolerate any losses by depositors at large depository institutions is called
A) the too-big-to-fail doctrine. B) the regulatory capture hypothesis. C) the lender of last-resort doctrine. D) corporate banking system welfare.
The capture theory of regulation states that _____
a. regulators act in the best interests of regulators b. regulators act in the best interests of politicians c. regulators act in the best interests of the general public d. regulators act in the best interests of the regulated
Suppose the Fed sells a $50,000 U.S. Treasury security to Martha, a member of the public. If Martha writes a check to the Fed in order to buy this security, the money in her checking account will be transferred to
A) the Fed, and now the Fed will have $50,000 more in reserves than it had before. B) her bank, and now her bank will have $50,000 more in reserves than it had before. C) the Fed, and now it is as if the money doesn't exist. D) the Treasury, and now the Treasury will have $50,000 more in reserves than it had before.