The Federal Open Market Committee was established to give the Fed the power to change reserve requirements
a. True
b. False
Indicate whether the statement is true or false
False
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Suppose the price of crude oil used to produce gasoline rises significantly. At the same time, consumers purchase hybrid cars in great numbers. In the market for gasoline, the market clearing price ________ and the equilibrium quantity ________
A) definitely falls, is indeterminate B) is indeterminate, definitely falls C) definitely falls, definitely rises D) definitely rises, is indeterminate
A natural monopoly is a market where:
a. a single firm has control over a vital natural resource. b. many smaller firms can produce the entire market output at the same per-unit cost as could one large firm. c. a single large firm can produce the entire market output at a lower per-unit cost than a group of smaller firms. d. many smaller firms can produce the entire market output at a lower per-unit cost than could one large firm.
There will be a surplus of a product when:
A. price is below the equilibrium level. B. the supply curve is downward sloping and the demand curve is upward sloping. C. the demand and supply curves fail to intersect. D. consumers want to buy less than producers offer for sale.
The Ricardian Equivalence proposition suggests that a tax increase that causes a budget surplus will
A) cause an increase in output. B) cause no change in output. C) cause a reduction in output. D) a reduction in consumption.