The main difference between a repo and federal funds transaction is that
A) the repo transaction uses the securities for collateral while the federal funds transaction does not have collateral.
B) the federal funds transaction uses securities for collateral while the repo transaction does not have collateral.
C) the repo transaction has an agreed upon interest rate while the federal funds transaction has a spread between the sale and purchase price of securities.
D) the federal funds transaction is normally overnight while the typical repo agreement is for 90 to 180 days.
A
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The slope of an indifference curve
A) measures total utility. B) is calculated by dividing the quantity of the good on the vertical axis by the quantity of the good on the horizontal axis. C) measures the marginal rate of substitution between the two goods in question. D) is calculated by dividing the price of good on the vertical axis by price of the good on the horizontal axis.
If in the long run a firm makes zero profit, it should exit the industry
Indicate whether the statement is true or false
What is monetary policy?
What will be an ideal response?
If at a given real interest rate desired national saving is $200 billion, domestic investment is $100 billion, and net capital outflow is $80 billion, then at that real interest rate in the loanable funds market there is a
a. surplus. The real interest rate will rise. b. surplus. The real interest rate will fall. c. shortage. The real interest rate will rise. d. shortage. The real interest rate will fall.