Firms that participate in regular open market transactions with the Federal Reserve are called
A) secondary market banks.
B) Treasury banks.
C) primary dealers.
D) Federal Reserve partners.
Answer: C
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In which of the following cases would the supply of loanable funds curve shift rightward?
A) Investment demand increases. B) The stock market booms, so people's wealth increases. C) In June, Sally learns that at year's end she will receive a bonus that will double her current salary. D) The economy moves into a recession. E) Joe is worried about cutbacks at his firm, so his expected future income falls.
An insurance company offering a high-deductible plan is an example of:
A. screening. B. signaling. C. statistical discrimination. D. building a reputation.
A money market mutual fund account is a(n): a. checking account that earns interest
b. savings account against which one can write checks. c. group of stocks sold under one name. d. claim on a collection of interest-earning assets that is not guaranteed by the FDIC. e. account with which the Fed buys and sells U.S. government securities.
In the long run,
a. higher consumption spending means a larger capital stock and a higher standard of living b. higher investment spending means higher interest rates c. higher investment spending means a larger capital stock and a higher standard of living d. higher interest rates means higher consumption spending e. higher government spending means a larger capital stock and a higher standard of living