When the Federal Reserve sells a government security to a commercial bank
A) the cash reserves of the commercial bank decrease.
B) the net worth of the commercial bank increases.
C) the loans of the commercial bank will increase.
D) the balance sheet of the commercial bank is thrown off balance.
Ans: A) the cash reserves of the commercial bank decrease.
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Refer to Table 6-8. What is the most distinctive feature of the supply curve?
A) The supply curve is horizontal. B) The supply curve is upward sloping. C) The supply curve is perfectly elastic. D) The supply curve is perfectly inelastic.
Suppose the upward sloping labor supply curve shifts leftward in a labor market with a single employer (monopsony). What happens to the marginal expenditure curve?
A) Shifts left B) Shifts right C) Remains the same D) We do not have enough information to answer this question.