Loans of the Federal Reserve Banks to commercial banks are:
A. A liability of the Federal Reserve Banks and of the commercial banks
B. An asset of the Federal Reserve Banks and of the commercial banks
C. A liability of the Federal Reserve Banks and an asset for commercial banks
D. An asset of the Federal Reserve Banks and a liability for commercial banks
D. An asset of the Federal Reserve Banks and a liability for commercial banks
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Refer to Figure 22-1. Many countries in Africa strongly discouraged and prohibited foreign direct investment in the 1950s and 1960s. By doing so, these countries were essentially preventing a moment from
A) B to C. B) D to C. C) A to B. D) B to A.
Assume that the central bank purchases government securities in the open market. If the nation has low mobility international capital markets and a flexible exchange rate system, what happens to the GDP Price Index and net nonreserve-related international borrowing/lending in the context of the Three-Sector-Model?
a. The GDP Price Index falls, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). b. The GDP Price Index rises, and net nonreserve-related international borrowing/lending becomes more negative (or less positive). c. The GDP Price Index falls, and net nonreserve-related international borrowing/lending becomes more positive (or less negative). d. The GDP Price Index and net nonreserve-related international borrowing/lending remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
Which of the following sequences would cause E1 to shift to E2?
a. P1 decreases to P2; D1 decreases to D2; Q1 decreases to Q2
b. P1 decreases to P2; Q1 decreases to Q2; D1 decreases to D2
c. D1 decreases to D2; P1 decreases to P2; Q1 decreases to Q2
d. Q1 decreases to Q2; D1 decreases to D2; P1 decreases to P2
What happens typically to a budget deficit during an economic recovery?
A. It decreases because of tax changes. B. It increases because of spending decreases. C. It decreases automatically. D. It increases automatically.