The idea that anticipated monetary policy cannot affect real variables such as real Gross Domestic Product (GDP) or employment is known as
A. the policy irrelevance proposition.
B. the job search model.
C. the Keynesian hypothesis.
D. the monetary velocity theory.
Answer: A
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State two examples of government-created monopolies
Answer the question based on the following balance sheet for the First National Bank. Assume the reserve ratio is 15 percent:
Refer to the data above. If a check for $20,000 is drawn and cleared against this bank, it will then have excess reserves of:
A. $15,000
B. $20,000
C. $25,000
D. $30,000
On a bank's balance sheet, the value of its assets must equal: a. net worth only
b. liabilities only. c. owner's equity. d. the value of its liabilities plus net worth. e. its revenues minus costs.
Which of the following are tools used by the Fed to implement monetary policy?
A. Printing Federal Reserve notes B. Open market operations C. Minting coins D. Regulating banks activities