Excess reserves are:
A. Bank reserves in excess of required reserves.
B. Legal reserves in excess of lending reserves.
C. Transactions deposits plus traveler's checks.
D. Total reserves plus deficient reserves.
A. Bank reserves in excess of required reserves.
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An economy's production function is Y = A , and the economy's total output in equilibrium is $90 billion. Total capital income in this economy is ________
A) $27 billion B) $30 billion C) $21 billion D) $70 billion E) none of the above
Spending a lot on advertising:
A. can act as a credible signal to consumers of high-quality products. B. does not serve as a credible signal to consumers, since any producer can do it. C. can act as a credible signal to producers to create high quality substitutes. D. can act as a credible signal to consumers of low-quality products.
The period of 1973 to 1980 can best be described as a time of
A. deflation. B. reflation. C. unflation. D. stagflation. E. disflation.
Monetarists and classical economists:
A. assume that stimulative monetary policy will create high levels of GDP without inflation. B. assume that stimulative monetary policy will create high levels of GDP and slightly high prices. C. assume the economy operates at full employment and stimulative monetary policy will only cause the price level to rise. D. assume that the economy operates at full employment and stimulative monetary policy will increase both aggregate supply and aggregate demand.