Banks hold excess and secondary reserves to
A) reduce the interest-rate risk problem.
B) provide for unexpected deposit outflows.
C) satisfy margin requirements.
D) achieve higher earnings than they can with loans.
B
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The Fed is
A) shielded from political pressure. B) officially independent from the federal government. C) staffed by Congressmen who are biased toward monetary expansion. D) responsible for minting coins and collecting taxes.
In the short run, the price level
a. will decrease if unit costs and markups both increase throughout the economy b. will remain stable if unit costs increase throughout the economy c. is unimportant in macroeconomics d. will increase if unit costs increase throughout the economy e. is determined by the Fed
Which of the following holds true in a market when the invisible hand functions properly?
a. MC = MU = P b. P = MRS c. P = MC but not P = MU d. P = MU but not P = MC
Josh runs a landscaping business in Vermont and decides to hire two people in India to maintain his bookkeeping for him electronically. Josh can pay them much less than he would pay a bookkeeper in the U.S., and the workers enjoy a higher quality of life in India thanks to their jobs with Josh's company. Josh's actions are an example of:
A. exporting. B. foreign direct investment. C. importing. D. foreign portfolio investment.