What is one service the Fed performs for the Treasury Department?
(A) It processes payments, such as Social Security checks.
(B) It auctions government bills.
(C) It collects federal taxes.
(D) It selects the Secretary of the Treasury.
Ans: (A) It processes payments, such as Social Security checks.
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If the Federal Reserve decreases the Federal funds rate, other short-term interest rates ________ and the exchange rate ________
A) fall; falls B) do not change; rises C) fall; does not change D) fall; rises E) do not change; falls
Suppose a new law imposes a tax on all trades of bonds and stock. What is the likely effect on money demand?
A) Money demand declines first, then rises when inflation increases. B) Money demand rises. C) The overall effect is ambiguous. D) Money demand declines.
Which curve in the market for foreign-currency exchange shifts and which direction does it shift if the government budget deficit increases? Explain why an increase in the budget deficit shifts this curve
A study by Price Fishback and Shawn Kantor of the University of Arizona shows that after the passage of workers' compensation laws, wages received by workers in the coal and lumber industries fell
Source: Price V. Fishback and Shawn Everett Kantor, "Did Workers Pay for the Passage of Workers' Compensation Laws?" Quarterly Journal of Economics, Vol. 100, No. 3, August 1995