Depository institutions do all the following EXCEPT
A) minimize the cost of obtaining funds.
B) create liquidity.
C) pool risks.
D) create required reserve ratios.
D
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Refer to the figure below.________ inflation will eventually move the economy pictured in the diagram from short-run equilibrium at point ________ to long-run equilibrium at point ________. 
A. Rising; A B. Falling; A; C C. Falling; B: C D. Rising; A; C
Rational expectations theory suggests that government or central bank policies designed to change aggregate demand will be effective
a. True b. False Indicate whether the statement is true or false
If fixed cost at quantity (Q) = 100 is $130, then
a. fixed cost at Q = 0 is $0. b. fixed cost at Q = 0 is less than $130. c. fixed cost at Q = 200 is $260. d. fixed cost at Q = 200 is $130. e. it is impossible to calculate fixed costs at any other quantity.
A reduction in interest rates by the Fed with the intention of reducing a recessionary gap is called:
A. monetary tightening. B. autonomous monetary policy. C. contractionary monetary policy. D. expansionary monetary policy.