Which of the following represents a preventative measure against bank runs?
A. The President of the United States can order banks to pay depositors.
B. The FDIC provides deposit insurance.
C. The Federal Reserve can lower reserve requirements to ensure that banks have sufficient funds.
D. None of these is correct.
Answer: B
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The above figure shows the apartment rental market in Bigtown. If severe flooding resulted in the destruction of many of the city's apartment buildings, then the
A) supply curve of apartments would shift leftward and rent would rise above $750.00. B) demand curve for apartments would shift rightward and rent would rise above $750.00. C) equilibrium quantity of apartments rented would increase beyond 3,000. D) equilibrium market price of apartments rented would fall below $750.00.
Fluctuating interest rates tend to stabilize real output when the
A) IS curve is flat. B) IS curve is steep. C) LM curve is flat. D) LM curve is steep.
A tax on the sellers of coffee will increase the price of coffee paid by buyers,
a. increase the effective price of coffee received by sellers, and increase the equilibrium quantity of coffee. b. increase the effective price of coffee received by sellers, and decrease the equilibrium quantity of coffee. c. decrease the effective price of coffee received by sellers, and increase the equilibrium quantity of coffee. d. decrease the effective price of coffee received by sellers, and decrease the equilibrium quantity of coffee.
If the supply of and demand for loanable funds both shift left, which of the following necessarily happens?
a. the equilibrium interest rate falls b. the equilibrium interest rate rises c. the equilibrium quantity of loanable funds rises d. the equilibrium quantity of loanable funds falls