By raising the legal reserve requirement, the Federal Reserve System
a. forces banks to hold funds from repaid loans as required reserves instead of lending the funds again
b. creates many new lending opportunities for cash-strapped financial intermediaries
c. actually creates new money because it allows more borrowers to come into banks to demand loans
d. seeks to increase the potential money multiplier
e. encourages member banks to loan more than what is legally feasible
A
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Refer to the graph shown. Which of the following curves demonstrates a perfectly elastic demand curve?
A. A B. B C. C D. None of the curves
In conducting statistical analysis to determine whether Head Start is effective, it is imperative that researchers compare Head Start graduates with
A. equally situated non-Head Start children. B. children who have stay-at-home parents. C. the general population. D. children who are in private child care arrangements.
Figure 6-6
The purchase of premium cable channels is an “all-or-nothing” choice. Which graph in Figure 6-6 best illustrates the cable market demand curve?
A. 1 B. 2 C. 3 D. 4
In using the expenditure approach to GDP, consumption
A. Includes houses and all purchases by business firms. B. Includes consumer durables, semi-durables, nondurable goods, but excludes services. C. Includes houses and services. D. includes consumer durables, semi-durable goods, nondurable goods, and services.