In the market for reserves, if the federal funds rate is between the discount rate and the interest rate paid on excess reserves, an increase in the reserve requirement ________ the ________ for reserves and causes the federal funds interest rate to
rise, everything else held constant. A) decreases; demand
B) increases; demand
C) increases; supply
D) decreases; supply
B
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Opportunity cost is represented on the production possibilities frontier by
A) attainable and unattainable points. B) efficient and inefficient points. C) the amount of good Y forgone when more of good X is produced. D) technological progress.
"If firms in duopoly collude and operate as a monopoly, the industry produces more output compared to the Nash equilibrium." True or false? Explain
What will be an ideal response?
Use the information below to explain adjustments that move the economy to a long-run equilibrium. Assume that firms and workers have adaptive expectations
The current unemployment rate = 4%. The natural rate of unemployment = 6%. Last year's inflation rate = 3%. This year's inflation rate = 4%.
Households' labor supply decisions are influenced by all of the following except _______
A. the opportunity cost of taking leisure and not working B. the after-tax wage rate C. unemployment benefits D. the number of full-time jobs available