Ceteris paribus, if the Fed raises the discount rate, then:
A. The money multiplier decreases.
B. The lending capacity of the banking system increases.
C. Excess reserves decrease.
D. The incentive to borrow reserves decreases.
A. The money multiplier decreases.
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Every transaction concerning the exportation of goods from the United States constitutes a
A) supply of foreign currency with no effect on the market for the dollar. B) demand for dollars with no effect on markets for foreign currencies. C) supply of foreign currencies and a demand for dollars. D) demand for foreign currencies and a supply of dollars.
Refer to the above diagram. Rent controls are best illustrated by:
A. quantity E. B. price A. C. price B. D. price C.
Which of the following conditions makes it most likely for a quota to be imposed?
A) The benefits of the quota are spread over many and the costs are concentrated on a few. B) The benefits of the quota are spread over many and the costs are spread over many. C) The benefits of the quota are spread over few and the costs are spread over many. D) The benefits of the quota are spread over few and the costs are spread over few. E) There is not enough information to answer the question.
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
According to the graph shown, if this economy was to engage in free trade, the good would:
A. not be imported or exported and only be produced domestically. B. no longer be produced domestically. C. be imported. D. be exported.