An increase in the nominal interest rate increases the quantity of credit card services because
A) bank profits go up.
B) of intertemporal substitution.
C) the opportunity cost of making transactions with money has risen.
D) the substitution effect is greater than the income effect.
C
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Which of the following about unemployment is true?
a. The unemployment rates of the major European economies were substantially lower than in the United States during the last decade. b. High unemployment rates over lengthy time periods are indicative of structural and regulatory factors that are exerting an adverse impact on the natural rate of unemployment. c. The natural rate of unemployment is unaffected by changes in the age composition of the labor force (for example, an increase in the relative number of youthful workers). d. Institutional changes such as an increase in the minimum wage may increase cyclical unemployment but will not affect the natural rate of unemployment.
A bank has $7 million in checkable deposits and $1.2 million in total reserves. If the required reserve ratio is 10 percent, then the bank has
A) required reserves of $700,000. B) excess reserves of $500,000. C) excess reserves of $1,080,000. D) required reserves of $120,000. E) a and b