In the market for bank reserves, the supply of reserves is

Some economists have argued that path dependence and switching costs can lead to market failure. Which of the following is an example of this argument?

A) VHS video recorders became more popular with consumers than Sony Betamax recorders even though the Betamax recorders embodied a superior technology. B) A consumer who won a lottery for a Super Bowl ticket refuses to sell it for $3,000 even though he would not have paid $3,000 for a ticket if he had not won the lottery. C) Costly celebrity endorsements lead many consumers to buy a product even though it is more expensive or less effective than a product that is not endorsed by a celebrity. D) While playing the ultimate game, an allocator decides to share $20 equally with a recipient rather than keep the $20 for herself.

Which of the following will lead to a decrease in the equilibrium interest rate in the economy?

A) a decrease in GDP B) an increase in the reserve requirement C) an increase in the price level D) a sale of government securities by the Fed E) an increase in the discount rate