Everything else held constant, when the federal funds rate is ________ the interest rate paid on reserves, the quantity of reserves demanded rises when the federal funds rate ________
A) above, rises
B) above, falls
C) below, rises
D) below, falls
B
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Refer to Figure 10.3. A positive demand shock accompanied by a decrease in the real interest rate is best represented by ________ in panel (a) and ________ in panel (b)
A) a shift from AE2 to AE3; a movement from point B to point C B) a shift from AE3 to AE2; a shift from IS2 to IS1 C) a shift from AE1 to AE2; a movement from point A to point B D) a shift from AE1 to AE3; a movement from point A to point C
A bank divided in different divisions for consumer banking and business banking is an example of
a. An M-form of an organization b. A functional organization c. An N-form organization d. All of the above
Holding all other forces constant, if decreasing the price of a good leads to a decrease in total revenue, then the demand for the good must be
a. unit elastic. b. inelastic. c. elastic. d. None of the above is correct because a price decrease never leads to an decrease in total revenue.
Inefficiency exists in an economy when a good is
a. being produced with less than all available resources. b. not distributed fairly among buyers. c. not being produced by the lowest-cost producers. d. being consumed by buyers who value it most highly.