When a commercial bank has excess reserves:
A. it is in a position to make additional loans.
B. its actual reserves are less than its required reserves.
C. it is charging too high an interest rate on its loans.
D. its reserves exceed its assets.
A. it is in a position to make additional loans.
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The self-correcting tendency of the economy means that falling inflation eventually eliminates:
A. exogenous spending. B. recessionary gaps. C. expansionary gaps. D. unemployment.
The rightward shift of the RS curve will lead to a ________ in the U.S. exchange rate, ________ in real GDP, and a ________ in the price level
A) rise; a decrease; fall B) rise; an increase; rise C) fall; an increase; rise D) rise; an increase; fall E) fall; an increase; fall The figure above shows the market for loanable funds. The supply of loanable funds curve shifts rightward.
What are natural experiments?
What will be an ideal response?
The purpose of the ceteris paribus assumption is to allow economists to
A) determine the relationship among several variables. B) determine the impact of several variables on another variable. C) isolate the impact of one variable on several variables. D) isolate the relationship between two variables.