When the Fed sells a government security to the public, how does it usually receive payment for the security?
a. by accepting checks on bank accounts
b. by drawing money out of circulation
c. by decreasing member bank profits not distributed by the Fed
d. by decreasing reserves in bank accounts at the Fed
a
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The sum of consumer surplus and producer surplus is equal to
A) total profit. B) zero. C) the economic surplus. D) the deadweight loss.
Pure economic rent is a payment to a resource that
A) has a high opportunity cost. B) has a perfectly inelastic supply. C) has a negative opportunity cost. D) has a perfectly elastic demand.
When economic profits are positive in a perfectly competitive industry,
a. we would expect the market supply curve to shift to the left as a result. b. we would expect the market supply curve to shift to the right as a result. c. we would not expect any change in the market supply curve to result. d. we would expect that the market demand curve to shift right as a result
Which of the following happens as a result of a decrease in income? a. The budget line becomes steeper. b. The budget line shifts inward. c. The budget line shifts outward
d. The budget line becomes flatter.