When the Fed lowers the discount rate, it
a. lowers the cost of borrowing from the Fed, allowing banks to make more loans
b. raises the cost of borrowing from the Fed, disallowing them from making the same quantity of loans
c. increases the amount of excess reserves that banks hold, allowing them to make more loans
d. increases the amount of excess reserves that banks hold, disallowing them from making the same quantity of loans
e. decreases the amount of excess reserves that banks hold, disallowing them from making the same quantity of loans
A
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In developed countries, tariffs on raw materials tend to be
A) highest of all. B) higher than on manufactured goods. C) equal to tariffs on manufactured goods. D) lower than on manufactured goods.
The forward exchange rate is relevant to transactions ________
A) that require an immediate transfer of funds B) that require a future transfer of funds C) that involve a transfer of funds within a corporate entity D) crossing state lines
Assume the price of beer is $4, the price of pizza is $10 and the consumer's income is $250. Which consumption bundle will NOT be the consumer's choice?
A) A (5 Beers, 5 Pizzas) B) B (0 Beers, 25 Pizzas) C) C (25 Beers, 15 Pizzas) D) None of the above bundles will be chosen.
If Joey goes surfing for four hours instead of earning $10 per hour for those four hours, his opportunity cost is
A) the good time spent surfing. B) the cost of gasoline used to get to the beach. C) the travel time to the beach. D) $40.