When the Fed lowers the target rate of interest for federal funds, it
A) buys government bonds.
B) lowers the discount rate.
C) sells government bonds.
D) lowers the required reserve ratio.
Ans: A) buys government bonds.
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Refer to Figure 16-6. With this pricing scheme - a competitive price for the classes and a one-time membership fee - what amount of producer surplus will Sensei earn?
A) the area A + B + C + D + E + F + G + H B) the area E + F. C) the area H + G + F. D) the area A + B + C + D + E.
From any point below the current LM curve, money market equilibrium can be restored by some combination of a ________ income and a ________ interest rate that ________ the demand for money
A) higher, higher, increases B) higher, lower, increases C) higher, lower, reduces D) lower, higher, increases E) lower, higher, reduces
Which of the following is an example of a direct tax?
A. Sales tax B. Property tax C. Gasoline tax D. Income tax
Suppose the average person needs 8 glasses of water each day to maintain optimal health. What would an economist conclude?
A) The average person will therefore drink 8 glasses each day. B) The average person will therefore drink more than 8 glasses each day, just to play it safe. C) There are no substitutes for water. D) The amount the average person drinks will depend upon the opportunity cost of acquiring water.