Which of the following is least likely to be a normal good?

The economy suffered a mild recession in 2001. Despite the recession, home sales and durable goods sales remained high. Which of the following is a plausible explanation?

A) The Fed's pursuit of contractionary policy stimulated these markets. B) The Fed caused a reduction in the federal funds rate to its lowest level in 40 years. C) Home building and consumer durable purchases are always high during a recession. D) Rising inflation encouraged many to invest in the real estate market.

Which of the following is a component of high powered money?

A) bonds held by banks, loans, and bank reserves B) currency in circulation plus bank reserves C) currency in circulation plus checkable deposits D) bonds held by banks plus checkable deposits E) the sum of currency in circulation, bank reserves, and checkable deposits