A commercial bank's reserves consist of
A) capital and U.S. Treasury securities.
B) vault cash and U.S. Treasury securities.
C) vault cash and deposits with the Federal Reserve.
D) deposits with the Federal Reserve and U.S. Treasury securities.
C
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The reason individual homeowners usually do not hire a private contractor to fill the potholes on their street is because:
a. it costs too much. b. the value to the neighborhood exceeds the cost of repair. c. others who use the street will be free riders. d. they do not trust the government. e. there are negative externalities associated with the repair.
A requirement that the budget be balanced each and every year would worsen the severity of economic fluctuations by preventing which of the following from working?
a. budget surpluses b. budget deficits c. automatic stabilizers d. manual stabilizers
The law of diminishing return holds that as additional increments of resources are:
a. added to a certain purpose, the marginal benefit from those additional increments will remain flat. b. removed to a certain purpose, the marginal benefit from those additional increments will decline. c. added to a certain purpose, the marginal benefit from those additional increments will incline. d. added to a certain purpose, the marginal benefit from those additional increments will decline.
After subtracting all deductions and exemptions from total income, you are left with
A. the tax base. B. marginal income. C. standardized income. D. taxable income.