Because the Federal Reserve System is a central bank, it provides banking services to
A) no one.
B) consumers and business.
C) commercial banks.
D) the government only.
E) businesses only.
C
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If expected inflation is constant, then when the nominal interest rate falls, the real interest rate
a. falls by more than the change in the nominal interest rate. b. falls by the change in the nominal interest rate. c. rises by the change in the nominal interest rate. d. rises by more than the change in the nominal interest rate.
After an employer pays the cost of educating a worker,
a. the worker has a higher level of human capital. b. the worker should become more productive. c. the worker might look for another job unless his employer pays him more. d. All of the above are correct.
Typically, the unemployment rate ________ during a recession and ________ during an expansion.
A. rises; falls B. rises; does not change C. rises; rises even more D. falls; rises
Assume Claudia's budget constraint is demonstrated by line A in the graph shown. Which of the following would cause Claudia's budget constraint to shift to line C?
A. The price of movie tickets dropped. B. Claudia's preferences for these two goods decreased. C. The price of books dropped. D. Claudia's income decreased.