The money supply will grow faster through deposit creation when the legal reserve requirement is
a. high and banks hold excess reserves
b. high and banks cannot find good customers to lend to
c. low and banks are able to lend out all of their excess reserves
d. low and banks are unable to loan out all of their excess reserves
e. high and banks are not able to loan out all of their excess reserves
C
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What is scarcity and why does it exist? How is scarcity related to the study of economics?
Approximately two decades after a "baby boom," one could expect: a. production to change from an interior point to a point along the production possibilities curve. b. a movement along the production possibilities curve from one point to another
c. an outward shift of the production possibilities curve along both axes. d. an inward shift of the production possibilities curve.
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.
The S & L debacle ultimately cost American taxpayers
A. at least $10 billion. B. about $100 billion C. about $200 billion. D. between $300 billion and $500 billion.