Author Question: Refer to the scenario above. Suppose the discount weight attached to the future benefit is 1/5. ... (Read 83 times)

j.rubin · **on:** Jun 29, 2018

Refer to the scenario above. Suppose the discount weight attached to the future benefit is 1/5. People will earn a net benefit equal to:

A) -500 utils.
B) -700 utils.
C) 860 utils.
D) 900 utils.

Question 2

The textbook asserts that banks create money themselves. How?

A) Banks have their own printing presses, which is permitted by the Fed.
B) Banks are allowed to reach well into their required reserves as long as they can demonstrate that it would be profitable to do so.
C) Banks, when lending out their excess reserves, unleash a process that can increase the money supply through the deposit expansion multiplier.
D) For all of the above reasons.