The term "crowding out" refers to the phenomenon that occurs when increased government spending
A) raises the price level and reduces consumption.
B) leads to higher interest rates which reduces private investments.
C) leads to higher bond prices which decreases the demand for Treasury bonds.
D) leads to increased budget deficits that ultimately warrant increases in income taxes.
Answer: B) leads to higher interest rates which reduces private investments.
Economics
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Suppose Bill Gates deposits $20 million into his checking account at Wells Fargo Bank. If the required reserve ratio is 10 percent, what is the maximum change in money supply?
A) -$200 million B) -$180 million C) $2 million D) $180 million E) $200 million
Economics
Reserve requirements is the rate the Fed charges when it lends money to banks
Indicate whether the statement is true or false
Economics