If the economy is in an inflationary boom, the Fed would most likely
a. increase bank reserves by raising the discount rate.
b. increase bank reserves by buying government securities
c. decrease bank reserves by lowering the discount rate.
d. decrease bank reserves by selling government securities.
e. decrease bank reserves by lowering the legal reserve requirement.
D
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A favorable supply shock shifts the production function curve ________ and the labor demand curve ________
A) upward, upward B) upward, downward C) downward, upward D) downward, downward
If the absolute value of the own price elasticity of demand is greater than 1, then demand is said to be:
A. unitary elastic. B. elastic. C. inelastic. D. neither elastic, inelastic, nor unitary elastic.
One In the News feature reports that General Motors planned to essentially quit making cars and trucks in the United States for nine weeks from mid-May through July 2009 and Omaha Power planned to close one of its nuclear plants permanently. Based on these particular news clips, what is the difference between GM's and Omaha Power's decisions?
A. Omaha Power was trying to get rid of excess inventory, and GM was trying to become more efficient. B. There is no difference between GM's and Omaha Power's decisions; both were trying to get rid of excess inventory. C. GM was trying to maximize profits while Omaha Power was trying to minimize losses. D. GM's decision to idle plants was a short-run shutdown decision. Omaha Power, by contrast, made a long-run decision to exit a specific market.
The General Agreement on Tariffs and Trade (GATT) is based on the principle of:
A. establishing a single international currency. B. tariff reductions through multilateral negotiations. C. converting tariffs to import quotas. D. establishing common environmental and labor standards for all member nations.