Congress created the Federal Deposit Insurance Corporation to
a. sell insurance to individuals who have bank accounts
b. inject reserves into the economy more quickly
c. develop a better working relationship between bank managers and government officials
d. charge higher interest rates to banks
e. reimburse those who lose their bank deposits
E
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Which of the following describes a situation in which demand must be elastic? a. Total revenue increases by 15 percent when the price of corn dogs rises by 15 percent
b. Total revenue increases by less than 15 percent when the price of corn dogs rises by 15 percent. c. Total revenue decreases by more than 15 percent when the price of corn dogs rises by 15 percent. d. Total revenue increases by $15 when the price of corn dogs rises by $15. e. Total revenue increases by more than $15 when the price of corn dogs rises by $15.
If the Federal Reserve unexpectedly decides to sell bonds, which of the following will most likely happen in the short run?
a. The demand for loanable funds will increase, which will exert upward pressure on the interest rate. b. The supply of loanable funds will decrease, which will exert upward pressure on the interest rate. c. The supply of loanable funds will increase, which will exert downward pressure on the interest rate. d. The natural rate of unemployment will increase.