Refer to the graph above. If Canadian investors buy more U.S. financial and real assets, then:
A. The demand curve will shift left
B. The demand curve will shift right
C. The supply curve will shift left
D. The supply curve will shift right
B. The demand curve will shift right
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Suppose a bank has $10 million in deposits with no excess reserves, and the reserve requirement is 20%. If the Fed reduces the reserve requirement to 5%, the bank can make a maximum loan of
A) $0. B) $0.5 million. C) $1.5 million. D) $2 million.
Which of the following is most consistent with the time-inconsistency problem?
A) while it is ten o'clock in the morning in Chicago, it will be eleven o'clock in New York City B) a monetary policy action that is implemented in January will not begin to influence economic variables for several months C) a parent who acquiesces to a child's demand just to keep them quiet in a public setting D) an economic model with adaptive expectations