When banks need to borrow funds at the end of the day to meet their legal reserve requirement, they
a. borrow the required funds from the Fed on the federal funds market
b. borrow the required funds from other banks on the federal funds market
c. ask for extensions on the deadline to meet their requirements, but pay a federal fundsrate as a penalty
d. engage in open market operations on the federal funds market
e. borrow from the government which reduces the government's public debt
B
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Aggregate demand in an economy with no government or foreign trade is
A) consumer expenditure plus actual investment. B) consumer expenditure plus planned investment. C) consumer expenditure plus inventory investment. D) consumer expenditure plus fixed investment.
If a market basket was defined in 2014 and it cost $10,000 to purchase the items in that basket in 2014, while it cost $11,000 to purchase those identical goods in 2015, then the base year is
A. 2014. B. 2013. C. 2015. D. none of these.
If the rate of exchange for a pound is $4, the rate of exchange for the dollar,
A. is 1/4 pound. B. is 4 pounds. C. is $.25. D. cannot be determined from the information given.
Refer to the diagrams for two separate product markets. Assume that society's optimal level of output in each market is Q0 and that government purposely shifts the market supply curve from S to S1 in diagram (a) on the left and from S to S2 in diagram (b) on the right. We can conclude that the government is correcting for
A. positive externalities in both diagrams. B. negative externalities in diagram (a) and positive externalities in diagram (b). C. negative externalities in both diagrams. D. positive externalities in diagram (a) and negative externalities in diagram (b).