The Federal Reserve purchases U.S. Treasury securities to:

A. increase the money supply.
B. reduce credit availability.
C. increase interest rates.
D. decrease expected inflation.
E. increase tax rates.


Answer: A

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Which of the following ratios does NOT measure liquidity?

a. Current ratio b. Quick ratio c. Working capital to total assets d. Debt to equity

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Fixed costs are ignored in allocating scarce resources because

a. they are unaffected by the allocation of scarce resources. b. fixed cost apply only to long-run decisions. c. they are sunk. d. there are no fixed costs associated with scarce resources.

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A deposit of cash to an account becomes available for withdrawal at the opening of the next banking day following the deposit

Indicate whether the statement is true or false

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