Suppose that Tom bought a bike from Helen for $195. If Helen's reservation price was $185, and Tom's reservation price was $215, the buyer's surplus from this transaction was:

When a bank makes loans with excess reserves, it

a. creates money. b. destroys money. c. alters the composition of M1. d. leaves the money supply unchanged.

When the Social Security system begins running a deficit, the bonds in the trust fund will be drawn down. The funds to redeem these bonds will have to come from

a. higher taxes, spending reductions in other programs, or additional government borrowing. b. the surplus funds deposited in governmental banking accounts. c. equity capital being liquidated. d. the sale of private equities and securities that the government has been purchasing with the funds.