Monetary policy affects economy-wide interest rates by:
A. setting the federal funds rate.
B. conducting open market operations.
C. changing bank reserve requirements.
Answer(s): A,B & C.
A. setting the federal funds rate.
B. conducting open market operations.
C. changing bank reserve requirements.
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The Fed buys securities and gives a bond dealer a check for the amount. After the check has cleared
A) reserves remain unchanged because the increase of reserves at the dealer's bank are offset by an increase in reserves at the Fed. B) reserves have risen by the amount of the check because the Fed clears the check by increasing the amount of the bank's deposits with the Fed. C) reserves have fallen by the amount of the check because the Fed clears the check by reducing the bank's deposits at the Fed. D) reserves have fallen by the amount of the reserves times the reserve ratio and the money supply increases by the difference between the amount of the check and the increase in the reserves.
The Salvation Army is an example of a(n)
a. military organization b. not-for-profit organization c. partnership d. S-corporation e. U.S. government agency
If you received a free month's trial membership in a gym, you would keep going until your marginal utility reached
A. a maximum. B. zero. C. a positive number. D. a negative number.
In general, which form of business organization has the greatest capacity to raise large sums of financial capital?
A) sole proprietorships B) partnerships C) limited partnerships D) corporations