A open market purchase of government securities by the Fed will cause which of the following?
A) an increase in the equilibrium quantity of reserves
B) a reduction in the federal funds rate
C) an increase in the amount of excess reserves that banks will wish to hold
D) all of the above
D
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All else equal, a decrease in government borrowing is likely to cause a(n):
A) upward movement along the credit demand curve. B) rightward shift of the credit demand curve. C) leftward shift of the credit demand curve. D) downward movement along the credit demand curve.
Under rate of return regulation, a regulated firm has an incentive to
A) use an efficient amount of capital. B) set its price equal to its marginal cost. C) hide losses from bad debts. D) inflate its costs.
Which of the following is a normative statement about economic growth?
A) Economic growth hurts developing countries. B) Economic growth increases GDP per capita. C) Foreign direct investment stimulates economic growth. D) Economic growth is associated with higher labor productivity growth.
The size of a family or household does not affect the data used to measure income inequality
a. True b. False Indicate whether the statement is true or false