The Federal Open Market Committee makes decisions about ________ policy.
A. banking
B. deposit insurance
C. monetary
D. fiscal
Answer: C
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Answer the following questions true (T) or false (F)
1. If, when price changes by 35 percent, the quantity demanded changes by 7 percent, then the absolute value of the price elasticity of demand is 5. 2. Suppose at a price of $50, Yoshi's Jazz Bar sells 20 tickets to its nightly jazz performance and at a price of $40, it sells 25 tickets. Based on this information, the demand for Yoshi's jazz performance is elastic. 3. If demand is inelastic, the absolute value of the price elasticity coefficient is greater than one.
Answer the following statement(s) true (T) or false (F)
1. A drafted army can be unnecessarily costly in two ways: it can be the wrong size or it can consist of the wrong people. 2. A draft is better for society because it is less costly than a volunteer army. 3. The Fabian argument that confiscation of rents would not lower social welfare overlooks the costs of resource misallocation. 4. The use of signals in an economy is both individually rational and socially efficient. 5. Because of adverse selection, no good used cars ever change hands.
A consumer cannot gain consumer’s surplus if she purchases more than one unit of a good.
Answer the following statement true (T) or false (F)
Everything else held constant, in the market for reserves, increases in the discount rate affect the federal funds rate
A) when the funds rate is below the discount rate. B) when the funds rate equals the discount rate. C) when the demand for federal funds intersects the vertical section of the reserve supply curve. D) when the demand for federal funds equals zero.