The monetary expansion process from an open market operation continues until
A) required reserves are eliminated.
B) the Federal Reserve takes actions to stop the process.
C) the discount rate is lower than market interest rates.
D) excess bank reserves are eliminated.
D
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Refer to Table 8-1. Suppose that a simple economy produces only four goods and services: sweatshirts, dental examinations, coffee drinks, and coffee beans. Assume all of the coffee beans are used in the production of the coffee drinks. Using the information in the above table, nominal GDP for this simple economy equals
A) 3,090 units. B) $7,250. C) $8,750. D) $9,750.
If the managers of a theater plan to raise ticket prices to increase ticket revenues, then they must believe that demand is
a. elastic b. inelastic c. unit elastic d. perfectly elastic e. income elastic
Which of the following program(s) examples is (are) in-kind assistance to fight poverty in the United States?
a. Medicaid b. Negative income tax c. Supplemental security income (SSI) d. Aid to Families with Dependent Children (AFDC) e. Welfare checks
Suppose the price of an item in a perfectly competitive market is $2. For a firm in this market, MC = MR at an output of 100 units. The average total cost at this output level is $4 per unit, and TVC is $80. We may conclude that
A) the firm should shut down because TC > TR. B) the firm should continue to produce because P>AVC. C) the firm should shut down because its TFC is $320 and its TC is $400. D) the firm should shut down because other firms will enter the industry as the market is perfectly competitive.