In the late 1990s, Thailand, Malaysia, and Indonesia all experienced sharp declines in the value of their currencies; this resulted in economic instability and crisis. The collapse in the values of their currencies undermined their development by:
A. decreasing political instability.
B. decreasing population growth.
C. increasing corruption.
D. reducing investment.
Answer: D
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Which of the following has been a problem faced by the FDIC in its provision of federal deposit insurance?
A) a relatively low number of bank failures each year, which has reduced the need for deposit insurance B) moral hazard arising from the tendency for the highest-risk banks to be those most interested in obtaining deposit insurance in the first place C) adverse selection arising from the tendency for banks to take on more risk after they receive deposit insurance D) moral hazard arising from the tendency for banks to take on more risk after they receive deposit insurance
If the slope of the aggregate expenditure curve is 0.5, then the expenditure multiplier equals
A) 5. B) 0.5. C) 2. D) 3. E) 4.
Exhibit 19-4 Balance sheet of Tucker National Bank Assets Liabilities Required reserves$ 4,000 Checkable deposits$20,000 Excess reserves16,000 Loans 0 Total$20,000 Total$20,000 Assume all banks in the system started with the balance sheet shown in Exhibit 19-4 and the Fed makes a $1,000 open market purchase. The result would be a(n):
A. infinite contraction of the money supply. B. infinite expansion of the money supply. C. $1,000 expansion of the money supply. D. $5,000 expansion of the money supply.
The underlying reason of the problem of pollution is
A) a poorly run Environmental Protection Agency. B) greed on the part of consumers. C) greed on the part of producers. D) poorly defined property rights that are expensive to enforce.