The major overall purpose of the Federal Reserve System is to
a. keep the discount rate flexible.
b. insure the deposits of persons holding funds with banking institutions.
c. regulate the money supply and, thereby, provide a monetary climate that is in the best interest of the economy.
d. regulate the levels of excess reserves held by member banking institutions.
C
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According to this Application, the recession in 1981 was caused by
A) the government cutting back on aggregate demand to reduce inflation. B) increasing oil prices which resulted in a decrease in aggregate supply. C) massive immigration from Europe to the United States. D) an decrease in aggregate supply resulting from U.S. bank collapses.
The use of government regulations and barriers in order to control trade is referred to as:
A) globalization. B) protectionism. C) liberalization. D) actualization.
Until 2007, the price of sport utility vehicles (SUVs) rose and each year more were purchased. This experience suggests that
A) there must have been technological advances in the way SUVs are produced. B) the "law of demand" does not hold true in this market. C) there must have movement leftward along the supply curve for SUVs. D) there must have been a rightward shift of the demand curve for SUVs.
So we can see that an increase in government spending will raise the level of economic equilibrium, while a decrease in government spending will lower it
What will be an ideal response?