Suppose you owned a nationally chartered bank. Your bank assets will increase when
a. the Fed buys government bonds from your bank on the open market
b. the Treasury sells government bonds to your bank on the open market
c. depositors take funds out of their demand deposit accounts at your bank
d. the Fed sells government bonds to your bank on the open market
e. the Fed lowers the discount rate
D
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The two cornerstones of Classical economics are the Quantity Theory and
A) Liquidity Preference Theory. B) disequilibrium analysis. C) Say's Law. D) the Phillips Curve.
The problem of moral hazard arises because _____
a. individuals receive insurance through their employer, who has different incentives b. individuals with insurance have no incentive to avoid insured expenditures c. some individuals have religious objections to purchasing insurance d. some individuals are immoral
Which of the following best expresses the benefit from international trade?
a. With trade, each country can concentrate on producing those goods and services that it produces most efficiently. b. With trade, a country can increase its political involvement on a global scale. c. Increased U.S. trade would improve high-tech exports but not agricultural exports. d. Increased trade would increase U.S. exports and decrease U.S. imports. e. Increased trade implies that exports of goods and services will always equal imports of goods and services.
When the economy produces less than its potential output, it is:
A. producing a quantity less than the long-run aggregate supply quantity. B. called a recession. C. not in long-run equilibrium. D. All of these are true.