The rate at which banks can borrow excess reserves from other banks is equal to
A. the discount rate.
B. the interest rate paid on reserves held with the Fed.
C. the federal funds rate.
D. the Treasury bill rate.
Answer: C
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A company has designed an alarm clock that "runs and hides" after going off, forcing the person to get up and find the alarm clock if he or she wants to shut off the alarm. According to behavioral economists:
A. it is unlikely to alter people's tendency to shut off the alarm and ultimately oversleep. B. the alarm clock keeps people from hitting the snooze button and taking advantage of the availability heuristic. C. the alarm clock serves as a precommitment device, helping the user to stick to the originally planned wake-up time. D. overconfidence effects will discourage use of such devices.
Refer to the graph shown. Given the quantity restriction of QR, a reduction in demand will:
A. have no impact on market price. B. raise equilibrium price. C. lower the market price. D. raise equilibrium quantity.