When the Fed is acting as fiscal agent for the Treasury, it will
A) buy securities from the Treasury, thereby providing the Treasury with money to pay the government's bills.
B) receive and process bids for Treasury securities in preparation for the Treasury's auction of securities.
C) serve as a lender of last resort.
D) supply the Treasury with paper money whenever the Treasury does not have enough funds to meet its bills.
E) supervise the Treasury by examining its books.
B
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The following is not a consequence of Xt and Yt being cointegrated:
A) if Xt and Yt are both I(1), then for some ?, Yt – ? Xt is I(0). B) Xt and Yt have the same stochastic trend. C) in the expression Yt – ? Xt , ? is called the cointegrating coefficient. D) if Xt and Yt are cointegrated then integrating one of the variables gives you the same result as integrating the other.
The income effect of an increase in the price of backpacks (a normal good) is a(n)
a. decrease in the demand for backpacks b. decrease in the quantity demanded of backpacks c. increase in the demand for backpacks d. increase in the quantity demanded of backpacks e. new demand curve because everything else is no longer constant