What are the prerequisites for money creation?
First, there must be a fractional reserve system that allows banks and other financial intermediaries to loan
out some percent of their deposits. Second, there must be people who make demand deposits. Finally, there
must be borrowers willing to take banks' loans.
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Which of the following best defines an optimum currency area?
A) a group of nations sharing the same currency B) a group of regions in close proximity to each other. C) a group of regions who operate under similar economic policies. D) a group of regions with economies closely linked by factor mobility and by trade in goods and services E) a group of nations that engage in free trade with each other
If, for a $1000 premium, you buy a $100,000 put option on bond futures with a strike price of 114, and at the expiration date the price is 110, your ________ is ________
A) profit; $4000 B) loss; $4000 C) profit; $3000 D) loss; $3000
Describe what happens to nominal and real interest rates, investment and aggregate demand when money supply shifts right or left, other things equal. When money demand shifts right or left
Which of the following could be used to support the argument that the natural rate of unemployment has fallen in the last ten years?
A. The proportion of young people in the labor force is shrinking. B. Many people who would normally be counted as unemployed are behind bars. C. Workers are more insecure because of numerous plant closings and corporate downsizing, and as a result, are less likely to quit their jobs to look for work elsewhere. D. All of the choices are correct.