Assume that the central bank increases the reserve requirement. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the real risk-free interest rate and reserve-related (central bank) transactions in the context of the Three-Sector-Model?
a. The real risk-free interest rate falls, and reserve-related (central bank) transactions become more negative (or less positive).
b. The real risk-free interest rate rises, and reserve-related (central bank) transactions become more negative (or less positive).
c. The real risk-free interest rate and reserve-related (central bank) transactions remain the same.
d. The real risk-free interest rate rises, and reserve-related (central bank) transactions remain the same.
e. There is not enough information to determine what happens to these two macroeconomic variables.
.D
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Refer to Figure 4.6, which shows David's and Celeste's individual supply curves for flower arrangements per week. Assuming David and Celeste are the only producers in the market, what is the market quantity supplied at a price of $20?
A) 0 B) 100 C) 150 D) 200
Coal is very useful in the production of electricity. Red beryl, although not generally considered as very useful, is a beautiful gemstone found in the mountains of Utah, and has been described as 1,000 times more valuable than gold
Explain why red beryl costs so much more than coal.
Which of the following financial institutions does NOT have to meet minimum reserve ratios?
i. the Fed ii. commercial banks iii. credit unions A) i only B) ii only C) iii only D) ii and iii E) i, ii, and iii
To be considered capital, a factor of production must:
A) have been produced. B) occur naturally. C) be part of a factory or building. D) be a skill or talent possessed by a person.