If a bank has $1 million in demand deposits, $400,000 in reserves, and faces a 30 percent reserve requirement, the amount of money that a bank could initially create by loaning out their excess reserves is:
a. $600,000.
b. $400,000.
c. $300,000.
d. $100,000.
d
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Consider two countries—A and B. Economy A is a command economy, while economy B is a market economy. Given this information, which of the following statements is likely to be true?
A) Both economies are likely to grow at the same rate. B) Both economies are likely to stagnate without any increase in GDP. C) Institutions in economy A are likely to be more inclusive than institutions in economy B. D) Institutions in economy B are likely to be more inclusive than institutions in economy A.
If a tax is imposed in a bargaining game, the players' cooperative surplus
A) increases. B) declines. C) remains unchanged. D) increases for one player and decreases for the other.
Sir Isaac Newton's development of the theory of gravity after observing an apple fall from a tree is an example of
a. a controlled experiment that lead to the formulation of a scientific theory. b. being in the right place at the right time. c. an idea whose time had come. d. the interplay between observation and theory in science.
The price parity concept, which is a cornerstone of U.S. agricultural policy, was established by the:
A. Agricultural Income Act of 1914 B. Agricultural Adjustment Act of 1933 C. Obama administration D. Reagan administration