Which of the following assets is the most liquid?
a. pounds of wheat
b. stocks
c. demand deposits
d. nontransactional deposits
c. demand deposits
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If planned investment changes as interest rates change, then
A) autonomous consumption changes. B) autonomous investment changes. C) total expenditures and output changes. D) the marginal leakage rate changes.
The International Monetary Fund was established to manage the Bretton Woods System
a. True b. False Indicate whether the statement is true or false
Ordinary commercial banks can expand the supply of money by
a. printing up currency when they need it. b. buying and selling government bonds to the general public. c. using a portion of their deposits to extend additional loans. d. reducing their vault cash and increasing their deposits with the Fed.
Figure 9.1 represents the market for used bikes. Suppose buyers are willing to pay $200 for a plum (high-quality) used bike and $50 for a lemon (low-quality) used bike. Initially buyers believe that 50% of used bikes in the market are lemons (low quality). Compared to the outcome with neutral expectations, how many fewer bikes are sold in equilibrium?
A. 8 B. 12 C. 18 D. 22