Banks would be expected to minimize holding excess reserves because this practice is:
a. illegal.
b. not profitable.
c. technically difficult.
d. subject to a stiff excess reserves tax.
b
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People take fewer trips by airplane when their incomes fall because of a recession. Trips by airplane must be
A) a normal good. B) an inferior good. C) a substitute for other goods. D) a complement to other goods. E) an inelastic good.
Explain the concept of causation with the help of a simple real-life example
What will be an ideal response?
An indirect cost of government debt is:
A. it can distort the credit market and slow economic growth. B. it can cause hyperinflation. C. it can cause unemployment below the natural rate. D. All of these are true.
An economy can produce at any point on or inside its production possibilities frontier, but it cannot produce at points outside its production possibilities frontier
a. True b. False Indicate whether the statement is true or false