The Federal Reserve responded to the 2008 financial crisis in several ways. Which of the following is one of the ways the Fed responded?
A) The Fed helped Citibank to acquire General Motors and Chrysler.
B) The Fed lent investment banks Treasury securities in exchange for mortgage-backed securities.
C) The Fed lowered the required reserve ratio on demand deposit accounts in order to increase the amount of bank reserves.
D) The Fed banned investment banks from obtaining discount loans.
B
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If the price level in the U.S. is 120, the price level in South Africa is 140, and the nominal exchange rate is 7 South African rands per dollar, then the real exchange rate is
A) 6 South African goods per U.S. good. B) 8.4 South African goods per U.S. good. C) 9.8 South African goods per U.S. good. D) 1.4 South African goods per U.S. good.
Scarcity forces us to choose, and choices are costly because we must give up other opportunities that we value
a. True b. False Indicate whether the statement is true or false
If your research leads you to believe that the present value of a stock's dividend stream and future price is less than its price then you believe the stock is
a. overvalued so you should consider buying it. b. overvalued so you should not consider buying it. c. undervalued so you should consider buying it. d. undervalued so you should not consider buying it.
When considering marginal revenue for the monopolist, which of the following is FALSE?
A) To sell more of a particular product, given the industry demand curve, the monopoly firm must lower the price. B) An essential point for the monopolist, marginal revenue is always less than price. C) Marginal revenue is always less than price because price must be reduced on all units to sell more. D) The more the monopolist wants to sell, the higher the price it has to charge in order to make more profits.