Which of the following functions does the Fed perform?
A. Printing money
B. Holding bank reserves
C. Providing loans to other countries
D. All of the above are functions the Fed performs.
B. Holding bank reserves
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Economists typically agree that the special protection given to owners of patents tends to
A) reduce economic growth. B) reduce productivity. C) reduce expenditures on research and development. D) increase expenditures on research and development.
Suppose a plaintiff hires a lawyer to represent her in a court case. The lawyer will be paid by the hour. Under this contract
A) efficiency is not achieved. B) the client bears all of the risk. C) the lawyer has an incentive to lie about his hours worked. D) All of the above.
If the price level in the current period is higher than what buyers and sellers anticipated,
a. profit margins will be unattractive and firms will expand output. b. profit margins will be unattractive and firms will reduce output. c. profit margins will be attractive and firms will expand output. d. profit margins will be attractive and firms will reduce output.
The Taylor rule states that if real GDP rises 1 percent above potential GDP the federal funds rate should be raised, relative to the current inflation rate, by ______.
a. 0.5% b. 1% c. 2% d. 4%