Suppose that the Fed undertakes an open market purchase of $5 million worth of securities from a bank. If the required reserve ratio is 12%, what is the resulting change in checkable deposits (or the money supply), assuming that there are no cash leakages and that banks hold zero excess reserves?
A) $4.17 million
B) $7.95 million
C) $5.68 million
D) $41.67 million
D
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Most tariffs have
A) only revenue effects. B) only protective effects. C) both protective and revenue effects. D) neither protective nor revenue effects.
For the simple case of a production function with two inputs in which the inputs are perfect complements, each isoquant is represented by:
A) a vertical line. B) a horizontal line C) a downward sloping straight line. D) a line that forms a right angle.
Firms with a continuous need for working capital financing will probably want to have __________ with a bank
A) credit rationing B) individually negotiated loans C) repurchase agreements D) a line of credit
What is marginal factor cost? How is it related to the supply curve of an input?
What will be an ideal response?