If the Fed wants to increase the lending capacity of the system by $60 billion and the reserve requirement is 10 percent, it should
A. Sell $6 billion in bonds to the public.
B. Buy $60 billion in bonds from banks.
C. Sell $60 billion in bonds to the public.
D. Buy $6 billion in bonds from banks.
Answer: D
You might also like to view...
Which of the following statements is correct?
a. About 25 percent of the U.S. population earns an income below the poverty line. b. About 50 percent of blacks earn an income below the poverty line. c. Since 1980 the fraction of persons below the poverty level has risen sharply. d. None of these.
An example of a(n) ________________ is the U.S. Postal Service, which is the only entity allowed to deliver first-class mail.
a. natural monopoly b. artificial monopoly c. legal monopoly d. technological monopoly
Increasing GDP generally causes increases in problems of waste disposal.
Answer the following statement true (T) or false (F)
In the table below, the capital stock is fixed at 40 units, the price of capital is $15 per unit, and the price of labor is $80 per unit. 
If the firm produces 40 units of output, what is average fixed cost?
A. $600 B. $120 C. $7.50 D. $25 E. none of the above