The required reserve ratio is:
a. the minimum amount of reserves the Fed requires a bank to hold.
b. the interest rate that the Fed charges banks who borrow from it.
c. the interest rate on loans made by banks to other banks.
d. the maximum percentage of the cost of a stock that can be borrowed from a bank, with the stock offered as collateral.
e. an appeal by the Fed to banks, asking for voluntary compliance with the Fed's wishes.
a
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In the 1937-1938 economic downturn
A. the number of unemployed rose dramatically by about 5 million. B. industrial production fell by 30 percent. C. presidential as well as Federal Reserve policy helped to cause the decline. D. All of the choices are true.
Consider a PPC with automobiles on the vertical axis and cotton on the horizontal axis. The discovery of a new fertilizer that improves crop yield will shift:
a. the vertical intercept up but will not shift the horizontal intercept. b. the horizontal intercept to the right but will not shift the vertical intercept. c. the horizontal intercept to the left and the vertical intercept upward. d. the vertical intercept downward and the horizontal intercept to the right. e. neither the horizontal intercept nor the vertical intercept.
In a price system, changes in prices
A. signal to everyone in the system what goods are relatively more or less scarce. B. signal to policy makers what goods should and should not be taxed more. C. make it difficult for the system to function well. D. imply that people have made mistakes in the past.
The main rationale for government regulatory functions is
A. to expand the scope of the government. B. to make sure that firms are maximizing profits. C. to protect consumer interests. D. to regulate for-profit institutions.