The ways the Fed can inject reserves into the banking system include:
A. making loans to non-bank corporations.
B. increasing the discount rate.
C. an increase in the size of the Fed's balance sheet through selling securities.
D. an increase in the size of the Fed's balance sheet through purchasing securities.
Answer: D
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An indirect tax is a tax paid by consumers
A) to a state or local government. B) when they purchase goods and services. C) on unearned income (as opposed to wages and salaries). D) that is a percentage of the value of their real property.
The term consumer sovereignty means that:
A. Government is responsible for protecting consumers' interests B. What is produced is ultimately determined by what consumers buy C. There are no limits on what consumers may buy in a market system D. Producers have strong control over what consumers buy
Suppose a perfectly competitive firm faces the following short-run cost and revenue conditions: ATC = $8.00; AVC = $5.00; MC = $8.00; MR = $9.00. The firm should
A) decrease output. B) increase output. C) increase price. D) continue to produce its current output.
The demand curve faced by a monopolist is
a. perfectly elastic b. perfectly inelastic c. undefined d. the market demand curve e. the sum of the demand curves for perfectly competitive firms in a similar industry