How are the operations of the Federal Reserve financed?
What will be an ideal response?
Most of the Fed's earnings come from interest on the securities it holds, with smaller amounts coming from interest on discount loans and fees that are received from financial institutions for check-clearing and other services.
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Which of the following is the best example of a common property?
a. The car of a student who is frequently willing to give her friends rides around town. b. The air that you breathe. c. Bread that you bake and share. d. Disney World
Which of the following is a primary market transaction?
A) Sally Wither purchases 100 shares of IBM through her broker. B) Kold Co. issues 1 million new shares through Morgan Stanley. C) Bob Hill sells 1,000 shares of Disney directly to his friend. D) Kip Peters sells 1,000 shares of Dush, Inc., which he bought in an IPO last month, through his broker.
An industry's typical percentage markup
a. should be expected to fluctuate wildly from year to year b. equals 1 - (average cost per unit/average revenue per unit) c. is determined by collusion d. is of price concern for the macroeconomy e. is relatively low if there is fierce competition among firms.
In order to determine tax incidence, one must
a. consider issues of equity. b. also determine the legal liability of the tax. c. evaluate where the tax burden eventually falls. d. use the "flypaper theory" of taxation.