If the Federal Reserve buys government bonds from the public,
A. Demand deposits will decrease.
B. Bank reserves will not change.
C. The money supply will contract.
D. Banks will be able to make additional loans.
Answer: D
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If the government of a country does not intervene in the foreign exchange market, then the country is said to have a:
A) flexible exchange rate system. B) managed exchange rate system. C) nominal exchange rate system. D) fixed exchange rate system.
Which of the following is an example of the unfairness of rent control?
A) Voluntary exchange is encouraged by rent control. B) Racial discrimination in renting is discouraged by rent control. C) Newcomers have a more difficult time finding apartments. D) Rich people do not get apartments in these markets. E) Too many people rent apartments.