The basic reason why the commercial banking system can increase its checkable deposits by a multiple of its excess reserves is that:
A. reserves lost by any particular bank will be gained by some other bank.
B. the central banks follow policies that prevent reserves from falling below the level required
by law.
C. the MPC of borrowers is greater than zero but less than 1.
D. the banking system must keep reserves equal to 100 percent of its checkable-deposit
liabilities.
A. reserves lost by any particular bank will be gained by some other bank
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The U.S. personal savings rate for the first quarter of 2012 dropped to its lowest level since the start of the recession. Americans stashed away 3.6 percent of personal income in the first quarter, down from 4
2 percent in the fourth quarter and a near-term peak of 6.2 percent in the second quarter of 2009. Which of the following could explain this drop in savings? A) a decrease in wealth from a fall in stock prices B) a rise in the real interest rate C) an increase in disposable income as the job market recovers D) a rise in consumer confidence that their incomes will be higher in the future
How are economists not like mathematicians, physicists, and biologists?
a. They devise theories, collect data, and then analyze these data in an attempt to verify or refute their theories. b. They use models to represent the real world. c. They try to address their subject with a scientist's objectivity. d. They cannot run lab experiments in the same way that other scientists can.
What are property rights?
A) the title to ownership of any physical asset B) the rights individuals or firms have to the exclusive use of their property, including the right to buy or sell it C) a legal document verifying ownership of intangible assets D) the right of the government to appropriate private assets for the good of society
Immiserizing growth is most likely to occur when
A. the increase in population equals the increase in national income of a country. B. economic growth leads to a deterioration of a country's terms of trade. C. the import payments of a country decline relative to its export earnings D. the benefits of economic growth are not shared equally by all residents of the country.