Answer the next question on the basis of the following consolidated balance sheet of the commercial banking system. Assume that the reserve requirement is 10%. All figures are in billions.Assets (billions of dollars)Liabilities & Net Worth (billions of dollars)Reserves$60Checkable deposits$600Securities140Stock shares260Loans260 Property400 Suppose the Fed wants to reduce the money supply by $400 billion to drive up interest rates and dampen inflation. Assuming that the money multiplier is operating to full effect, to accomplish the desired reduction, the Fed could ________.
A. sell $40 billion of U.S. securities to the banks
B. buy $40 billion of U.S. securities from the banks
C. buy $20 billion of U.S. securities from the banks
D. sell $20 billion of U.S. securities to the banks
Answer: A
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All of the following questions or statements regarding medical school are positive except
A) Medical students who enter specialized fields make a larger contribution to society than do student who enter primary care. B) What role does tuition play in a student's decision about whether to attend medical school? C) Have tuition increases had a large effect or a small effect on the number of applications to medical school? D) How do changes in expected future incomes affect the decisions of medical students about which specialty to choose?
Gross domestic product (GDP) is a satisfactory measure of both economic "goods" and "bads"
a. True b. False Indicate whether the statement is true or false
Unions
a. raise the wages of unionized workers and raise unemployment. b. raise the wages of unionized workers and reduce unemployment. c. reduce the wages of unionized workers and raise unemployment. d. reduce the wages of unionized workers and reduce unemployment.
Large scale family farms represent about 10% of all farms and produce:
a. Over half of the value of farm production b. About 10% of the value of production c. Less than 10% of the value of production d. About 20% of the value of production