Which of these is most likely an effect of a decrease in the prime lending rate by the Federal Reserve System in a growing economy? Savings accounts will earn more money The rate of inflation will increase. Businesses will begin to lay off employees. The value of the U.S. dollar will increase.

The demand for money will increase when inflation increases. True or false

Which one of the following statements is the MOST accurate? A temporary increase in a country's money supply causes a proportional long- run depreciation of its currency against foreign currencies. A permanent increase in a country's money supply causes a proportional long- run appreciation of its currency against foreign currencies. A permanent increase in a country's money supply causes a proportional short- run appreciation of its currency against foreign currencies. A permanent increase in a country's money supply causes a proportional long- run depreciation of its currency against foreign currencies. A permanent increase in a country's money supply causes a proportional short- run depreciation of its currency against foreign currencies.

Question 22 Refer to the accompanying figure. If the government has a budget of $300,000 to purchase surplus shampoo, what is the maximum possible floor price that could be imposed? Price S. 4 2 8,000 15,000 25.000 75.000/100.000 125.000 175.000 Quantity 47,000 90,000 $5 $4 $2 $1 $3 3.

What would happen if the federal reserve created too much, or not enough, currency over a given period?

Fractional Banking allows A) banks to make loans. B) businesses to loan to individuals. C) ndividuals to borrow from the Fed. D) banks to borrow from the Fed

You find a $1,000 bill hidden beneath the floorboards in your house and decide to deposit it in your checking account. On the same day, the Fed decides to buy $1,000 in government securities from your bank. Assuming a 10 percent reserve requirement, which of these actions creates more money in the economy?

Topic: Banks and the Economy   For an economy to thrive, there must be a strong banking system. If the banks fail and must be bailed out, it will have an effect on the economy.   If people lose faith in the safety and security of financial institutions, what will happen to the U.S. economy?   Please use at least 100 words in your response.

After suffering two years of staggering hyperinflation, the African nation of Zimbabwe officially abandoned its currency, the Zimbabwean dollar, in April 2009 and made the U.S. dollar its official currency. Why would anyone in Zimbabwe be willing to accept U.S. dollars in exchange for goods and services?

In a less-developed economy, cattle is widely accepted as payment for goods and services. Nearly all goods and services are priced in terms of cattle; however, cows vary in quality, become less valuable with age, and are difficult to move over long distances. Which of the following functions of money do cattle provide? Select the two correct answers.     portability   uniformity   medium of exchange   unit of account   store of value