As a result of the given transactions, reserves in the banking system will:
Answer the question on the assumption that the legal reserve ratio is 20 percent. Suppose that
the Fed sells $500 of government securities to commercial banks (paid for out of commercial
bank reserves) and buys $500 of securities from individuals, who deposit the cash in checking
accounts.
A. remain unchanged.
B. rise by $100.
C. fall by $100.
D. rise by $1,000.
A. remain unchanged.
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Perfect competition is characterized by all of the following EXCEPT
A) a large number of buyers and sellers. B) no restrictions on entry into or exit from the industry. C) considerable advertising by individual firms. D) buyers and sellers are well informed about prices. E) firms produce an identical product.
You are thinking about buying a house. You find one you like that costs $200,000 . You learn that your bank will give you a mortgage for $160,000 and that you would have to use all of your savings to make the down payment of $40,000
You calculate that the mortgage payments, property taxes, insurance, maintenance, and utilities would total $950 per month. Is $950 the cost of owning the house? What important factor(s) have you left out of your calculation of the cost of ownership?
Suppose that 2 per cent of the employed lose their jobs each month (s = 0.02) and 38 per cent of the unemployed find a job each month (f = 0.38). Then, the steady-state rate of unemployment is:
A. 2 percent. B. 5 per cent. C. 16 per cent. D. 36 per cent.
People who lost their jobs as hand-drawn animators because of the popularity of computer-generated 3D animation are examples of persons who are suffering
A) frictional unemployment. B) structural unemployment. C) cyclical unemployment. D) seasonal unemployment.