Riley deposits $4,000 cash in her checkable deposit at Fershur Bank. If the desired reserve ratio is 5 percent, Fershur Bank's
A) desired reserves increase by $4,000.
B) liabilities do not change but its assets increase.
C) excess reserves increase by $4,000.
D) desired reserves increase by $200 and its excess reserves increase by $3,800.
E) assets and its liabilities change in opposite directions.
D
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
Economic models must be tested with data to see if they are correct.
Answer the following statement true (T) or false (F)
Emma owns a firm that produces umbrellas. Currently, Emma produces 2,500 umbrellas a day. Emma cannot produce more umbrellas in a day unless she purchases another machine or else hires more workers. Emma is ________ efficient
A) cost B) technologically C) economically D) capital and labor
The results of studies of the tobacco industry suggests that college and secondary school students who smoke are much more likely to respond to a change in price than adults who smoke
Indicate whether the statement is true or false