The purchase of $1 million of Treasury securities by the Federal Reserve, if there is no change in the quantity of currency, will cause reserves at banks to
A) increase by $1 million. B) decrease by less than $1 million.
C) decrease by $1 million. D) increase by less than $1 million.
A
Economics
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When a depository institution pools risk, it
A) buys short and lends long. B) borrows reserves from the Federal Reserve. C) spreads loan losses across many depositors so that no one depositor faces a high degree of risk. D) makes loans to just one firm.
Economics
Other things equal, a 10 percent decrease in corporate income taxes will:
A. decrease the market price of real capital goods. B. have no effect on the location of the investment-demand curve. C. shift the investment-demand curve to the right. D. shift the investment-demand curve to the left.
Economics