Holding the money deposits of businesses and households and making loans to the public are the basic functions of
A. the Federal Deposit Insurance Corporation and the Federal Savings and Loan Insurance Corporation.
B. district banks of the Federal Reserve System.
C. the Open Market Committee and the Board of Governors.
D. commercial banks and thrift institutions.
Answer: D
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Assume all banks in the system started have a 10 percent required reserve ratio and the Fed made a $20,000 open market purchase. The result would be a(n):
A. $200,000 expansion of the money supply. B. $20,000 expansion of the money supply. C. $20,000 contraction of the money supply. D. infinite contraction of the money supply.
Which of the following is the most accurate statement?
a. In the 1970s, the late 1980s, 1990s, and 2000s, the GDP deflator and the CPI both showed high rates of inflation. b. In the 1970s, both the GDP deflator and the consumer price index showed high rates of inflation, and in the late 1980s, 1990s, and 2000s, both measures showed low rates of inflation. c. In the 1970s, both the GDP deflator and the consumer price index showed low rates of inflation, and in the late 1980s, 1990s, and 2000s, both measures showed high rates of inflation. d. In the 1970s, the late 1980s, 1990s, and 2000s, the GDP deflator and the CPI both showed low rates of inflation.
In the Keynesian model of aggregate expenditure, real GDP is determined by the
a) price level b) level of aggregate demand c) level of aggregate supply d) level of taxes
Which of the following would be categorized as "land"?
A. timber B. buildings C. human capital D. entrepreneurship