If you put $500 into a checking account, the immediate effect (do not consider the money multiplier which we will study in the next chapter) is:
a. M1 rises, M2 falls, and the monetary base remains the same.
b. M1 falls, M2 falls, and the monetary base remains the same.
c. M1 rises, M2 rises, and the monetary base remains the same.
d. M1, M2, and the monetary base rise.
e. M1, M2, and the monetary base remain the same.
.E
You might also like to view...
According to the Congressional Budget Office, from the 1970s to the 2000s, the natural rate of unemployment in the United States:
A. remained relatively stable. B. increased. C. fell. D. fell to zero, and has since become negative.
Which of the following must decline if there is a reserve deficiency in the banking system?
A) Demand deposits B) Reserves C) Net worth D) The demand deposit multiplier
Most state governments in the United States operate under constitutional provisions that severely restrict expenditures financed by borrowing
Suppose this were to change, so that state governments' access to credit markets was no different from the federal government. What consequences would you predict for the nation's aggregate debt burden?
Suppose an economist advises the government to disallow a proposed merger between Wendy's and McDonald's because she thinks the fast-food industry ought to be as competitive as possible. This advice is an example of
a. positive economics b. normative economics c. market discrimination d. econometric analysis e. macroeconomic analysis