The Fed purchases $100 million of U.S. government securities from First National Bank. The balance sheet for First National Bank shows ________ in its total assets and ________ in its total liabilities
A) no change; no change
B) a $100 million increase; a $100 million increase
C) a $100 million decrease; a $100 million increase
D) a $100 million increase; no change
E) a $100 million increase; a $100 million decrease
A
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Economy with no productivity growth is called the
A) zero-sum society. B) zero-growth society. C) export-led society. D) doomed-to-fail society.
Julio makes wine and beer. Last year he made 20 bottles of wine and 20 cases of beer. If the price of grapes goes down (making wine cheaper to make), Julio will be able to make the same amount of wine and more beer
a. True b. False Indicate whether the statement is true or false
Chile is an importer of computer chips, taking the world price of $12 per chip as given. Suppose Chile imposes a $7 tariff on chips. Which of the following outcomes is possible?
a. The price of chips in Chile increases to $19; the quantity of Chilean-produced chips decreases; and the quantity of chips imported by Chile decreases. b. The price of chips in Chile increases to $16; the quantity of Chilean-produced chips increases; and the quantity of chips imported by Chile decreases. c. The price of chips in Chile increases to $19; the quantity of Chilean-produced chips increases; and the quantity of chips imported by Chile decreases. d. The price of chips in Chile increases to $16; the quantity of Chilean-produced chips increases; and the quantity of chips imported by Chile does not change.
Suppose banks decide to hold more excess reserves relative to deposits. Other things the same, this action will cause the
a. money supply to fall. To reduce the impact of this the Fed could lower the discount rate. b. money supply to fall. To reduce the impact of this the Fed could raise the discount rate. c. money supply to rise. To reduce the impact of this the Fed could lower the discount rate. d. money supply to rise. To reduce the impact of this the Fed could raise the discount rate.