In 1936, when the Fed doubled the reserve requirements, bank executives:
A. allowed their excess reserves to decline.
B. maintained the level of excess reserves desired by the Fed.
C. increased excess reserves to the level prior to the change in requirements.
D. increased lending from remaining reserves, causing inflation.
Answer: C
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Which of the following would most likely cause the production possibilities curve for breadfruit and fish to shift outward from AA to BB in Figure 2-2?
a. a decrease in the labor force of the country b. a sudden change in consumer preferences for more fish and less breadfruit c. a major technological advance d. a decrease in the capital stock
In the aggregate demand and aggregate supply model, an increase in the growth rate of the velocity of money differs from an increase in money supply growth rate in that:
A. the SRAS curve will eventually shift back to its original position after an increase in money supply growth. B. the AD curve will eventually shift back to its original position after an increase in velocity growth. C. the SRAS curve will eventually shift upwards after an increase in velocity growth. D. the AD curve will eventually shift back to its original position after an increase in money supply growth.
When the production of a good results in a positive externality(such as education) the social value demand curve is
A. To the left of the demand curve, indicating that the total value to society is less than the private benefit. B. To the right of the market demand curve, indicating that the total value to society is greater than the private benefit C. Identical to the market demand curve, indicating that the total cost to society is the equal to the private benefit D. To the left of the market supply curve, indicating that the total cost to society exceeds the private cost
Overall income disparity can be measured by the
A. difference between GDP and GNI. B. growth rate in real GDP. C. Gini Index. D. population growth rate.