If the Fed reduces the required reserve ratio,
a. excess reserves will increase.
b. excess reserves will decrease.
c. total reserves will increase.
d. total reserves will decrease.
a
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Mr. Max is about to purchase 4 units of good A and 6 units of good B. The price of both A and B is $2 . Mr. Max has only $20 to spend. If the marginal utility of the fourth unit of A is 12 and the marginal utility of the sixth unit of B is 12, then:
a. he should not buy anything. b. he should buy more of A and less of B. c. he should buy less of A and more of B. d. he should buy A and B in the quantities indicated. e. he should buy more of A and little more than that of B.
Answer the question on the basis of the following data. All figures are in billions of dollars: Government Purchases 15 Consumption 90 Gross Investment 20 Consumption of Fixed Capital 5 Exports 8 Imports 12 Refer to the above data. NDP is:
a) $116. b) $121. c) $125. d) $150.
The actual value of price elasticity of demand
A) measures the relative change in quantity demanded when there is a change in price. B) will change when the units good is measured in changes. C) varies with changes in supply. D) is always negative.
One reason why adverse selection problems arise in health insurance markets is that
A) sick people are more likely to want health insurance than healthy people. B) because of advances in medical technology, people are living longer. These medical advances are costly and drive up the price of insurance for everyone. C) the average age of citizens of the United States has increased in recent years, and will continue to increase over the next 20 to 30 years. As older citizens retire, more and more of their medical bills will have to be paid by younger workers. D) fewer men and women are choosing medical careers because of the increase in the cost of malpractice insurance.