Which of the following correctly describes the system of fractional reserve banking?
a. Banks keep a fraction of their loans with other banks to maintain the quality of their loan portfolio.
b. Banks can loan out the entire deposits but a small fraction of their own profits must be kept as reserve in bank vaults.
c. Banks reserves amount to only a fraction of funds on deposit with the bank.
d. The federal government insures only a fraction of the deposits at most banks.
c
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If an economy is operating on its production possibility frontier, which of the following statements is true?
A. Products are produced using inefficient production technology. B. The capacity utilization rate is less than full production. C. The economy's labor force is fully employed. D. A fall in the price of an input will enable the economy to produce outside the production possibility frontier.
The national debt is ____ of the United States government and ___ of the people who hold it.
A. an asset; an asset B. a liability; a liability C. an asset; a liability D. a liability; an asset
The seven members of the Board of Governors of the Federal Reserve System are:
A. appointed by the presidents of the 12 Federal Reserve Banks. B. appointed by the Senate Finance Committee. C. elected by Congress from a slate of nominees provided by the president. D. appointed by the president with the confirmation of the Senate.
Answer the following questions true (T) or false (F)
1. On average, people in the United States spend a smaller percentage of their income on health care than do people in most other countries. 2. The United Kingdom has a health care system under which the government owns most of the hospitals and employs most of the doctors. 3. Japan has a single-payer health care system in which the government provides national health insurance to all Japanese residents.