Assume that the currency-deposit ratio is 0.2 and the reserve-deposit ratio is 0.1. The Federal Reserve carries out open-market operations, purchasing $1 million worth of bonds from banks. This action will increase the money supply by
A. $1 million.
B. $2 million.
C. $3 million.
D. $4 million.
Answer: D
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Lee and Cody are playing a game in which Lee has the first move at A in the decision tree shown below. Once Lee has chosen either aggression or cooperation, Cody, who can see what Lee has chosen, must choose either aggression or cooperation at B or C. Both players know the payoffs at the end of each branch. 
If Lee chooses aggression, Cody will respond with ________, and if Lee chooses cooperation, Cody will respond with ________.
A. aggression; aggression B. cooperation; aggression C. cooperation; cooperation D. aggression; cooperation
The above figure shows a
A. long-run aggregate demand curve. B. short-run aggregate supply curve. C. long-run aggregate supply curve. D. short-run aggregate demand curve.
Those who may file antitrust lawsuits against violators of the Sherman Act include the following, except:
A. Injured private parties B. State attorneys general C. U.S. Department of Labor D. U.S. Department of Justice
Name and explain the three reasons for holding money balances.
What will be an ideal response?