Questions from Macroeconomics


Q: Suppose bank A borrows reserves from bank B. Now that bank

Suppose bank A borrows reserves from bank B. Now that bank A has more reserves than previously, will the money supply increase? Explain your answer.

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Q: Explain how a decrease in the required reserve ratio increases the money

Explain how a decrease in the required reserve ratio increases the money supply.

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Q: Suppose you read in the newspaper that all last week the Fed

Suppose you read in the newspaper that all last week the Fed conducted open market purchases and that on Tuesday of last week it lowered the discount rate. What would you say the Fed is trying to do?...

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Q: Explain the similarities and differences between an open market purchase and quantitative

Explain the similarities and differences between an open market purchase and quantitative easing.

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Q: Describe how each of the following would affect the U.S

Describe how each of the following would affect the U.S. PPF: (a) An increase in the number of illegal immigrants entering the country, (b) A war that takes place on U.S. soil, (c) The discovery of...

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Q: Explain how the following can be represented in a PPF framework:

Explain how the following can be represented in a PPF framework: (a) The finiteness of resources implicit in the scarcity condition; (b) Choice; (c) Opportunity cost; (d) Productive efficiency; (...

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Q: What condition must hold for the production possibilities frontier to be bowed

What condition must hold for the production possibilities frontier to be bowed outward (concave downward)? To be a straight line?

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Q: Give an example to illustrate each of the following: (

Give an example to illustrate each of the following: (a) Constant opportunity costs (b) Increasing opportunity costs

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Q: Why are most production possibilities frontiers for goods bowed outward (concave

Why are most production possibilities frontiers for goods bowed outward (concave downward)?

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Q: Within a PPF framework, explain each of the following:

Within a PPF framework, explain each of the following: (a) A disagreement between a person who favors more domestic welfare spending and one who favors more national defense spending (b) An incr...

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