The Fed purchases 100 million of U.S. government securities from ...

[dalyningkenk]

The Fed purchases 100 million of U.S. government securities from First National Bank. The balance sheet for First National Bank shows ________ in its total assets and ________ in its total liabilities.
 
  A) no change; no change
  B) a 100 million increase; a 100 million increase
  C) a 100 million decrease; a 100 million increase
  D) a 100 million increase; no change
  E) a 100 million increase; a 100 million decrease

Question 2

Suppose the current unemployment rate is 5 percent, the labor force is 400 million people, the labor force participation rate is 80 percent and the working-age population is 500 million people. What number of people are unemployed?
 
  What will be an ideal response?

[akpaschal]

Answer to Question 1

A

Answer to Question 2

The number of unemployed people equals the labor force multiplied by the unemployment rate. Hence the number of unemployed people is (400 million)  (5 percent) = 20 million people.

[dalyningkenk]

Thanks for the timely response, appreciate it

[kishoreddi]

Gracias!