The price that we observe in the market is
A. the money price.
B. the law of demand.
C. the relative price.
D. a substitute.
Answer: A
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Fractional reserve banking
(a) destroys money. (b) requires banks to engage in 100 percent of total banking activities. (c) allows banks to create money while requiring them only to hold a fraction of money. (d) all of the above.
An auction of 28-day loans was carried out by the Fed through
a. the Term Auction Facility. b. the discount window. c. open market operations. d. reserve requirements.
Which one of the following assets has the greater liquidity?
a. A $10 pizza b. A $10 ticket to next week's basketball game c. A $100 stereo d. A dollar bill e. A $200 U.S. savings bond
If the national debt is owned by domestic citizens:
a. the debt will not have to be repaid. b. future interest payments transfer funds from one group of Americans to another. c. the debt will have to be repaid first to domestic creditors, then to foreign creditors. d. future interest payments will go to pay foreign debt first, then debt owed to American citizens.