A sound policy to combat a temporary liquidity surplus in the banking system would be
A) a reduction in the discount rate.
B) a decrease in the discount rate.
C) the purchase of government securities by the Fed under a repurchase agreement.
D) the sale of government securities by the Fed under a repurchase agreement.
D
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Other things equal, one would predict that market wages would be relatively high when
a. the supply of labor is high. b. the demand for labor is low. c. the supply of labor is low. d. Both (a.) and (b.) are correct
If an inflationary boom exists, the appropriate fiscal policy is to:
a. increase the budget deficit. b. increase government spending and hold taxes constant. c. decrease government spending and/or raise taxes. d. hold government spending constant and decrease taxes.
One of the key factors in the economic success of South Korea was
a. an increase in years of schooling. b. a reduction in the amount of imports. c. the creation of new technology. d. all of the above.
Which of the following observations is true?
a. Tax changes have no impact on the consumption schedule. b. Tax reduction shifts the consumption schedule upward. c. Changes in taxes have a multiplier effect on equilibrium GDP on the supply side. d. Tax increases increase equilibrium GDP.