If a bank does not have enough reserves, it can:
A. Buy bonds on the open market.
B. Raise the interest rate it charges borrowers.
C. Borrow reserves from the discount window.
D. Make more loans.
C. Borrow reserves from the discount window.
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A profit center
a. Is very complicated to run and manage b. Doesn't require a lot of attention from executives at the firm's headquarters c. Requires the parent company's highest degree of attention d. Does not properly incentivize the managers when it comes to their own division's performance
If consumption expenditures fall, then in the short run
a. inflation and unemployment rise. b. inflation rises and unemployment falls. c. inflation falls and unemployment rises. d. inflation and unemployment fall.
Refer to the accompanying figure, which shows the market for cups of coffee. What might cause a shift from the original demand curve to the new demand curve?
A. An expectation that coffee prices will fall in the future. B. An increase in consumers' tastes for coffee. C. A decrease in the price of tea. D. An increase in the price of coffee creamer.
The "housing bubble" discussed in the text book refers to:
A. housing prices rising much more quickly than the rest of prices in the economy. B. an unexplained increase in the demand for houses which caused the prices of houses to rise. C. a supply shock to the housing market, which caused housing prices to increase. D. housing prices within a certain area of the U.S. rising disproportionately with the rest of houses in the economy.