Holding all else constant, when a bank receives the funds for a deposited check
A) cash items in the process of collection fall by the amount of the check.
B) bank assets increase by the amount of the check.
C) bank liabilities decrease by the amount of the check.
D) bank reserves increase by the amount of required reserves.
A
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To convert the nominal interest rate to the real interest rate, we
A) divide the nominal interest rate by the inflation rate. B) multiply the nominal interest rate by the inflation rate. C) subtract the inflation rate from the nominal interest rate. D) add the inflation rate to the nominal interest rate. E) subtract the nominal interest rate from the inflation rate and then multiply by 100.
The above figure shows the market for steel ingots. What is the change in consumer surplus if the market switches from competitive equilibrium to social optimum?
A) $625 B) $1250 C) $1875 D) $2500
According to monetary neutrality and the Fisher effect, an increase in the money supply growth rate eventually increases
a. inflation and nominal interest rates, but does not change real interest rates. b. inflation, nominal interest rates, and real interest rates. c. inflation and real interest rates, but does not change nominal interest rates. d. nominal interest rates and real interest rates, but does not change inflation.
Situation 37-2 Dan and Ann live in the same community and both can participate in two activities, producing and stealing. Refer to Situation 37-2. Both Dan and Ann realize that they are better off producing and not stealing from each other than producing and stealing from each other. They agree not to steal from each other. There is no enforcer of their agreement to not steal. It is likely that
A) Dan and Ann are in a prisoner's dilemma setting. B) Dan is in a prisoner's dilemma setting but Ann is not. C) Ann is in a prisoner's dilemma setting but Dan is not. D) neither Dan nor Ann is in a prisoner's dilemma setting.