Explain and demonstrate graphically how targeting the federal funds rate can result in fluctuations in nonborrowed reserves
What will be an ideal response?
See figure below.
With a federal funds rate target, fluctuations in demand for reserves require similar changes in the nonborrowed reserves to keep the federal funds rate constant.
Economics
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Investment spending tends to be closely related to the current pace of economic growth
Indicate whether the statement is true or false
Economics
Increasing marginal returns to labor might occur at low levels of labor input because of
A) increasing average costs. B) differing factor proportions. C) increasing specialization of tasks. D) decreasing use of machinery and increasing use of technology.
Economics