If people withdraw $1,000 from the nation's money market mutual funds and redeposit the funds in various checkable and debitable accounts, then
A. M1 and M2 will remain unchanged.
B. M1 and M2 will increase.
C. M1 will increase, M2 will remain unchanged.
D. M1 will increase, M2 will decrease.
Answer: C
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Who is an unemployed worker? If the number of employed workers in a country, where the size of the labor force is 4 million, is 2.75 million, what is the number of unemployed workers in the country?
What will be an ideal response?
A small commercial bank has $10,000 in actual reserves, $60,000 in deposits, and has a 10 percent desired reserve ratio. Its excess reserves are
A) $4,000. B) $10,000. C) $50,000. D) $6,000.
The maximum amount a rent seeker would pay for a monopoly is the ________
A) market price B) deadweight loss C) monopoly's economic profit D) monopoly's normal profit
Economist James Tobin developed a formal model that justifies holding ________, and it goes some way in explaining variations in the demand for ________
A) only safe assets or only risky assets, M1 B) only safe assets or only risky assets, M2 C) a mix of safe and risky assets, M1 D) a mix of safe and risky assets, M2