An increase in the reserve ratio
A. increases the money multiplier.
B. will cause banks to make more loans.
C. has a contractionary effect on the money supply.
D. has an expansionary effect on the money supply.
Answer: C
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A. True B. False
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Indicate whether the statement is true or false
Bonds issued by state and local governments are called ________ bonds
A) corporate B) Treasury C) municipal D) commercial
The basic incentive problem is that owners and employees:
A. generally operate in perfectly competitive markets. B. are both concerned about sales maximization. C. have fundamentally different objectives. D. need government assistance to solve differences.