The non-bank public chooses among various financial assets in deciding what kind of liquidity it wants to hold. It thereby increases or decreases
A) the narrowly-defined money stock (M1).
B) the reserves of commercial banks.
C) the reserves commercial banks are required to hold.
D) all of the above, at least potentially.
E) none of the above, since only the Fed can alter the money supply.
D
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The above figure shows a labor market. Before the minimum wage of $8 an hour is imposed, employment equals ________ workers; after the minimum wage of $8 an hour is imposed, employment equals ________ workers
A) 80,000; 40,000 B) 40,000; 80,000 C) 60,000; 40,000 D) 60,000; 80,000 E) 80,000; 60,000
When considering outsourcing, most laypeople:
A. oppose it because of the visible loss of jobs. B. support it because they enjoy lower consumer prices. C. recognize its benefits to raising foreign wages. D. recognize it frees resources for other jobs for which the U.S. has a comparative advantage.