All of the following are functions of the Federal Reserve System EXCEPT
A. acting as the government's fiscal agent.
B. supplying the economy with fiduciary currency.
C. lending funds to risky customers denied credit by commercial banks.
D. providing a system of check collection and clearing.
Answer: C
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If the price of rubber (an input to the production of tires) increases:
A. the supply of tires will decrease. B. the demand for tires will decrease C. the demand for tires will increase. D. the supply of tires will increase.
If an increase in income results in higher prices for yachts, we can conclude
A. that yachts are inferior goods. B. that there was a decrease in the supply of yachts. C. that there was an increase in the supply of yachts. D. that yachts are normal goods. E. there’s no relationship between income and the demand for yachts.
An increase in the marginal propensity to save (MPS)
A) increases autonomous consumption. B) increases the value of the multiplier. C) increases the marginal propensity to consume (MPC). D) none of the above.
Increases in ________ typically lead to decreases in consumption
A) the interest rate B) disposable income C) autonomous consumption D) all of the above E) none of the above