The Federal Reserve finances its credit policy with
A. funding from the U.S. Treasury Department.
B. reserve deposits that private banks hold with the Fed.
C. borrowing from the federal government.
D. the insurance premiums collected by the FDIC.
Answer: B
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Scarcity is a problem that will eventually disappear as technology advances
Indicate whether the statement is true or false
GDP is: a. the value of all final goods and services produced domestically within a given period of time
b. the value of all final good and services produced anywhere in the world by a nation's firms within a given period of time. c. the value of all final goods and services produced by a government within a given period of time. d. the sum of all currency and coins in circulation.
The Exchange Rate Mechanism (ERM) was:
A) an attempt to bring all countries under a fixed exchange rate system. B) a fixed exchange rate system in Europe, with the Deutsche Mark as the anchor currency. C) a fixed exchange rate system in Europe, with the British pound as the anchor currency D) a fixed exchange rate system in use in the 1960s.