Bank regulators impose capital requirements in order to
a. increase the amount of leverage in the economy.
b. provide an incentive for banks to hold risky assets.
c. ensure banks can pay off depositors.
d. increase the probability of a credit crunch.
c
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Which of the following is NOT a step involved in using checks?
A) The recipient must take the check to the bank. B) The bank must present the check to the checkwriter's bank. C) The funds must be transferred from the checkwriter's bank to the recipient's bank. D) The funds must be transferred from the recipient's bank to the checkwriter's bank.
Refer to the above figure. Suppose the current aggregate demand is represented by AD2. If aggregate demand falls to line AD3, then
A) the new equilibrium will be at j. B) the new equilibrium will be at k. C) the new equilibrium real Gross Domestic Product (GDP) will be x. D) a new price level will be established at a.