The Fed conducts an open-market sale of Treasury bills of $5 million. If the required reserve ratio is 0.20, what change in the money supply can be expected using the oversimplified money multiplier?
A. $25 million
B. $5 million
C. 0
D. ?$5 million
E. ?$25 million
Answer: E
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Gold certificates, special drawing rights, the reserve position of the IMF, and the holdings of foreign currencies represent:
A) physical assets. B) reserve assets. C) monetary assets. D) none of the above.
______ measures the percent change in the cost of a fixed consumption bundle.
A. A fixed-weight price index B. Substitution bias C. Compensating variation D. Real income
Figure 3-21
Refer to . At the quantity Q2,
a.
the value to buyers and the cost to sellers are both P2.
b.
the value to buyers is P2 and the cost to sellers is P3.
c.
the value to buyers and the cost to sellers are both P3.
d.
the value to buyers is P3 and the cost to sellers is P2.
Output regulation forces the natural monopolist to produce at an output
A. Where MR = MC. B. That perfectly competitive firms would choose. C. Where MR equals zero. D. Greater than its profit-maximizing choice.