Refer to the data provided in Table 11.4 below to answer the following question(s).
Table 11.4 
Refer to Table 11.4. When the interest rate ________, the farmer will engage in no investment.
A. is greater than 10%
B. is less than 30%
C. is greater than 30%
D. is less than 10%
Answer: C
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If there is no one who is interested in borrowing from a bank:
a. the bank's excess reserves will be zero. b. there will be no process of money creation. c. the required reserve ratio must be equal to zero. d. the required reserve ratio must be equal to 100 percent.
The figure above shows the market for bank reserves in Futureland. If the Bank of Futureland undertakes an open market purchase of government securities that changes the quantity of reserves by $25 billion, then the federal funds rate will
A) fall to 4 percent a year.
B) remain at 6 percent a year.
C) rise to 8 percent a year.
D) change, but more information is needed to determine by how much.
E) None of the above answers is correct.
Interpret what an increase in demand and an increase in supply mean. Discuss the causes of an increase in demand and an increase in supply. How are increases in demand and supply expressed graphically? ?
What will be an ideal response?
The real cost of borrowing is unchanged when the ________ interest rate and the ________ rate increase by the same amount.
A. real; inflation B. real; nominal interest C. nominal; inflation D. nominal; real interest