The money supply consists of:
A) currency plus reserves.
B) currency plus required reserves.
C) currency plus excess reserves.
D) currency plus demand deposits.
D
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The deadweight loss associated with a policy change is measured as
a. the maximum value of consumer surplus b. the sum of consumer surplus and producer surplus associated with the new policy c. the excess of producer surplus over consumer surplus d. the sum of ? consumer surplus plus ? producer surplus associated with the new policy
How does imperfect information affect market decisions?
A. It doesn’t because information is generally excellent. B. It leads to inefficient outcomes in which expected benefits and actual benefits diverge. C. It leads to wasteful attempts to improve information. D. It leads to exploitation of sellers by buyers.
The Fed changes the federal funds rate using open-market operations.
a. true b. false
Which one of the following is to be a tool of monetary policy for altering the reserves of commercial banks?
a. Unemployment rate b. Tax rate c. Budget surplus or deficit d. Discount rate