Author Question: Which of the following is true of the quantity demanded of reserves? A) The quantity demanded of ... (Read 76 times)

Diane · **on:** Jun 30, 2018

Which of the following is true of the quantity demanded of reserves?

A) The quantity demanded of reserves increases as the federal funds rate falls.
B) The quantity demanded of reserves increases as the inflation rate increases.
C) The quantity demanded of reserves is constant over time for almost every bank.
D) The quantity demanded of reserves increases at a constant rate over time.

Question 2

Joe runs a business and needs to decide how many hours to stay open. Figure 2.2 illustrates his marginal benefit of staying open for each additional hour. Suppose that Joe's marginal cost of staying open per hour is 24.

How many hours should Joe stay open?
A) 3 hours B) 4 hours C) 5 hours D) 6 hours