Which of the following is false?
a. In a liquidity trap, expansionary monetary policy will tend to increase the excess reserves in the banking system.
b. If there are currently excess reserves in the banking system, in a liquidity trap, expansionary monetary policy will lead those excess reserves to be lent out by the banking system
c. If there are no changes in the level of excess reserves held in the banking system as a result, both expansionary and contractionary monetary policy can successfully shift the money supply curve
d. None of the above; all of the above are true.
b
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The tax on Social Security is statutorily paid _____
a. by individuals b. by employers c. two-thirds by individuals and one-third by employers d. half by individuals and half by employers
A possible market solution that a reputable firm can engage in when faced with the lemons problem is
A) to offer a warranty. B) to engage in externalities. C) to create asymmetric information. D) to use average cost pricing.
Which of the following was not used to subsidize railroad companies and their building of railroads?
a. Loans from the U.S. government b. Reduced corporate income taxes c. Land grants d. Direct payments based on the number of miles of tracks laid
Why did rising housing prices from 2001 to 2006 encourage lenders to give mortgages even to people they thought would default?
a. Lenders felt the government would pay for any losses they suffered from defaults. b. Lenders felt credit was so easy to obtain that customers in default could easily get more financing. c. Lenders felt that if borrowers defaulted that would leave the lenders with houses that were worth more than they had been owed. d. Lenders felt that regulations would soon change to help people facing foreclosure and prevent defaults.