Name three actions the Fed can take to increase the money supply
Open-market purchases (buy government bonds), reduce the required reserve ratio, reduce the discount rate, reduce interest on reserves
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Explain why the FDIC is following a "too-big-to-fail" policy of fully protecting all depositors at the largest banks
What will be an ideal response?
The monetary base will increase if
A) currency outstanding decreases. B) loans by the Fed to commercial banks decrease. C) bank reserves increase. D) vault cash in banks increases.
Suppose two owners of a store agree to split the profit equally regardless of the number of hours each spends working at the store. As a result,
A) production efficiency is achieved. B) each enjoys only half the marginal benefit of an additional hour working in the store. C) one will work all of the time while the other works zero hours. D) each will work as many hours as if he or she were the sole owner.
An increase in price could occur due to a(n)
a. Increase in demand and no change in supply b. Decrease in supply and no change in demand c. An increase in demand and decrease in supply d. All of the above