It is widely believed that the Federal Reserve's most important function is
A) to provide loans to the federal government.
B) to regulate the money supply.
C) to set the legal, controlled consumer interest rates.
D) to lend to risky customers.
B
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Refer to Table 7-2. Select the statement that accurately interprets the data in the table
A) Madison has an absolute advantage in making empanadas and tacos. B) Austin has an absolute advantage in making empanadas and tacos. C) Madison has an absolute advantage in making empanadas and Austin has an absolute advantage in making tacos. D) Madison has an absolute advantage in making tacos and Austin has an absolute advantage in making empanadas.
What happens to real money demand (rise, fall, no change) due to a change in each of the following factors?
(a) A tax on stock market transactions is introduced. (b) Computerized bond trading reduces transactions costs. (c) People's average level of wealth rises. (d) The threat of a recession increases the riskiness of stocks and bonds. (e) The interest rate paid on checking account balances declines. (f) The price level falls in a one-time jump.