What are two ways that governments can prevent banking panics?
What will be an ideal response?
First, a central bank can act as lender of last resort. Second, the government can insure bank deposits.
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In economics, all the items that people would consume if they had unlimited income are known as
A) wants. B) aggregates. C) outputs. D) needs.
Suppose a perfectly competitive firm can produce 20,000 bushels of corn a year at an output at which marginal cost equals marginal revenue. The market price of corn per bushel is $2.00
The firm's total costs per year are $50,000 and fixed costs per year are $25,000. In the short run, this firm should A) shut down. B) continue producing until the price of corn increases. C) produce 20,000 bushels of corn because, although they are losing money, they are losing less than if they shut down. D) produce 40,000 bushels to try to increase economic profit.
Bob owns an auto parts firm. He uses a combination of steel and aluminum to produce his auto parts. All of the following combinations will finish the task on time. Steel costs $15 per unit and the aluminum costs $50 per unit. What combination of steel and aluminum should he use?
A. 10 units of steel and 10 units of aluminum B. 20 units of steel and 6 units of aluminum C. 15 units of steel and 7 units of aluminum D. 12 units of steel and 8 units of aluminum
Mexican imports of U.S. goods:
A. create a supply of pesos. B. create a supply of dollars. C. reduce the demand for dollars. D. have no effect on the peso-dollar exchange rate.