Learning curves mean
a. you learn from experience
b. current production decreases future unit costs
c. production today leads to lower costs in the future
d. All of the above
d
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If the Fed lowered the required reserve ratio,
a. excess reserves would decrease b. the money supply would decrease c. the money supply would increase d. banks would borrow more from the Fed e. loans would earn more interest
In terms of desirable features of a monetary policy instrument, explain why the size of the staff at the Fed is not a good policy instrument. Be sure to address which feature(s) it fits and which one(s) it doesn't.
What will be an ideal response?
The quantity of reserves demanded decreases as the federal funds rate rises because
A. people want more liquid assets as the federal funds rate rises. B. the price of bonds rise as the federal funds rate rises. C. the opportunity cost of holding excess reserves increases as the federal funds rate rises. D. people want more money to invest as the federal funds rate rises.
A firm's retaining of earnings is really equivalent to the firm
A. decreasing the net worth of households. B. decreasing its own net worth. C. borrowing money from households. D. lending money to households.