What is the impact of an interest ceiling on bank deposits but not on loans?
An interest ceiling on bank deposits lowers the quantity supplied of loanable funds and raises the rate of interest charged on loans. Banks enjoy greater amount of profits by borrowing at a low rate of interest from depositors and lending out the funds at a high rate of interest to the borrowers (investors).
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The power of the contract and the ability to enforce contracts in the U.S. are, in part, responsible for the overall success of the U.S. economy
Indicate whether the statement is true or false
Max has allocated $100 toward meats for his barbecue. His budget line and an indifference map are shown in the above figure. Which bundle will Max choose?
A) a B) b C) c D) d
In the 1980s, U.S. economists acknowledged that it was not possible to exploit the trade-off suggested by the Philips curve of the 1960s. This realization led to more stable macroeconomic policy, which in turn contributed to:
a. more volatility in real output. b. less volatility in real output. c. complete removal of unemployment. d. more volatility in the price level. e. short business cycles.
Net exports are
A. the smallest component of GDP. B. income after taxes. C. the largest component of GDP. D. included in government spending.