Assume X is an inferior good. If the incomes of people who buy X increase, demand for X will increase as well, but by a smaller percentage than the increase in income
Indicate whether the statement is true or false
FALSE
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Financial intermediaries provide customers with liquidity services. Liquidity services
A) make it easier for customers to conduct transactions. B) allow customers to have a cup of coffee while waiting in the lobby. C) are a result of the asymmetric information problem. D) are another term for asset transformation.
A Federal Reserve repurchase agreement involves
A) an agreement by a bank to repay a discount loan on a specific day. B) an agreement by a dealer to buy back securities she has sold to the Fed. C) an agreement between the Fed and the Treasury for the Fed to purchase a specified amount of Treasury securities. D) an agreement by a commercial bank to make a loan to another bank in the federal funds market.
Cobb-Douglas production functions can never possess varying returns to scale
Indicate whether the statement is true or false
The money supply is
A) the rate at which the Federal Reserve Board prints currency. B) limited to currency and coins. C) the amount of money in circulation. D) the rate at which the Federal Reserve Board creates money.