Benchmark Review

Front

What could cause AD to shift left: increase in taxes, increase in gov spending, fed buys bonds, decrease in interest rates?

Back

increase in taxes

Front

If AD decreases, then

Back

unemployment increases

Front

When the government deliberately alters its level of spending and/or taxing in order to achieve changes in aggregate demand, it is exercising

Back

fiscal policy.

Front

Which of the following is an example of the expansionary fiscal policy? Increase in government spending, Decrease in government spending, Increase in reserve requirement, Decrease in reserve requirement

Back

Increase in government spending

Front

When the government needs to borrow funds for long periods of time, it

Back

issues bonds.

Front

Which of the following is NOT a tool used by the Federal Open Market Committee when conducting monetary policy?
Options:
taxes,
omo,
rr,
dr

Back

taxes

Front

Suppose a bank customer deposits $5,000 in cash into a local bank that currently has no excess reserves. Given a reserve requirement of 10%, how much does the bank need to keep?

Back

$500

Front

Suppose a bank customer deposits $5,000 in cash into a local bank that currently has no excess reserves. Given a reserve requirement of 10%, how much can then lend?

Back

$4,500

Front

Suppose a bank customer deposits $5,000 in cash into a local bank that currently has no excess reserves. Given a reserve requirement of 10%, what is the total change in the money supply (M1)?

Back

$45,000

Front

If minimum wage is set ABOVE equilibrium, what will happen?

Back

surplus