The interest rate will increase as a result of which of the following events?
A) an increase in income
B) an open market purchase of bonds by the central bank
C) a reduction in income
D) all of the above
E) none of the above
A
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Assume the commercial banking system has checkable deposits of $20 billion and excess reserves of $2 billion when the reserve requirement is 25%. If the reserve requirement is then lowered to 20%, we can conclude that the ________.
A. banking system now has excess reserves of $3 billion B. Fed has decided that money supply needed to be reduced C. monetary multiplier has decreased D. maximum money-creating potential of the banking system has been increased by $7 billion
After being introduced in 1999, the euro
A. increased in value through 2008. B. decreased in value through 2008. C. increased in value through 2000 but then decreased in value through 2008. D. decreased in value through 2000 but then increased in value through 2008.
The costs of inflation that arise from trying to reduce cash holdings are known as:
A. shoe leather costs. B. menu costs. C. chain-index costs. D. diminishing costs.
Economic growth can be portrayed as a(n):
What will be an ideal response?