The Federal Reserve Act:
a. established a system which allowed for better regulation of financial intermediaries.
b. allowed only nationally-chartered banks to become members of the Federal Reserve system.
c. allowed the Fed District Banks to offer commercial loans to private businesses at reduced interest rates.
d. required that all Fed District Bank directors be associated with the commercial banking industry.
e. all of the above.
a. . established a system which allowed for better regulation of financial intermediaries.
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On the Fed's balance sheet, assets include
A) reserves of depository institutions and mortgage-backed securities. B) U.S. government securities and mortgage-backed securities. C) currency and reserves of depository institutions. D) currency and mortgage-backed securities.
A negative externality exists and government wants to impose a per-unit tax in order to bring about the socially optimal output. To accomplish its objective, government must set the tax equal to marginal
A. private cost. B. social benefit. C. external cost. D. social cost. E. private benefit.
Which of the following falls when bond prices rise?
a. Stock prices. b. Interest rates. c. Money demand. d. Money supply.
The greater the marginal propensity to consume in the economy, the smaller the spending multiplier
a. True b. False Indicate whether the statement is true or false