Open market operations are the
A) purchase or sale of government securities by the Fed.
B) lending of reserves to the banking system by the Fed.
C) borrowing of reserves by the Fed from the banking system.
D) minimum percentage of loans that banks must retain as reserves in the open market.
E) purchase or sale of gold by the Fed.
A
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A tax hike ________ aggregate demand and ________ aggregate supply
A) increases; increases B) increases; decreases C) decreases; increases D) decreases; decreases E) does not change;increases
Suppose early Friday morning the economics club buys 200 donuts at 25 cents each, and plans to sell all of them later in the day on campus for 50 cents each
Only 60 donuts are sold at 50 cents, however, and by early afternoon the club is seen trying to unload the remaining donuts for 10 cents each. What can we conclude? A) The club was clearly engaging in predatory pricing of donuts. B) The club was clearly selling below cost. C) The club clearly misjudged the demand for donuts. D) All of the above are true.