Changes in which of the following will cause changes in the equilibrium federal funds rate?
A) the demand for excess reserves by banks
B) the supply of reserves created through past open market operations
C) the demand for required reserves by banks
D) all of the above
D
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Three individuals have $1000 and identical preferences for gum, g, and cigarettes, s, as measured by the utility function U(g,s) = 10g0.9a0.1. The price of gum is $9 and the price of cigarettes is $12
What is the market surplus/shortage at a price of $12 when the supply of cigarettes is 5? A) There will be a shortage of 3 cigarettes. B) There will be a surplus of 3 cigarettes. C) There will be a shortage of 2/3 cigarettes. D) There will be a surplus of 2/3 cigarettes.
Explain why the marginal cost curve intersects a U-shaped average cost curve at its minimum point
What will be an ideal response?