When a banker accepts a deposit of $1,000 in cash and puts $200 aside as required reserves and then makes a loan of $800 to a new borrower, this set of transactions
a. decreases the money supply by $1,000.
b. decreases the money supply by $200.
c. does not change the money supply.
d. increases the money supply by $200.
e. increases the money supply by $800.
E
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Which of the following is not a cause of market failure?
A) Incomplete information B) Externalities C) Individuals acting according to their own self-interest D) Public goods
Which of the following changes would clearly decrease the supply of money in the banking system?
a. an increase in the percentage of money people want to hold as currency and a decrease in the fraction of deposits banks want to hold as excess reserves b. an increase in the percentage of money people want to hold as currency and an increase in the fraction of deposits banks want to hold as excess reserves c. a decrease in the percentage of money people want to hold as currency and a decrease in the fraction of deposits banks want to hold as excess reserves d. a decrease in the percentage of money people want to hold as currency and an increase in the fraction of deposits banks want to hold as excess reserves
We call the situation in which the government makes a problem worse when it attempts to deal with it a(n):
A. government failure. B. deadweight loss. C. nudge. D. incentive compatibility problem.
Tyler was fired when a machine took over his duties. He is so frustrated that he has decided to wait a few months before looking for a job. What type of unemployment is he?
a. frictional b. natural c. not unemployed d. structural