The fact that there is a market for federal funds enables banks to:
A. hold a lower level of excess reserves than they would otherwise hold.
B. hold less in required reserves.
C. borrow more from the Fed.
D. make fewer loans than they would otherwise.
Answer: A
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Indicate whether the statement is true or false
Foreign currency prices of the U.S. dollar are currently determined by a managed float exchange rate system
Indicate whether the statement is true or false
Other things equal, in an open economy, monetary policy to offset an inflationary gap will tend to
a. Lower the exchange value of the dollar and lower net exports. b. Lower the exchange value of the dollar and raise net exports. c. Raise the exchange value of the dollar and lower net exports. d. Raise the exchange value of the dollar and raise net exports.
A recession is always associated with
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