When Dale buys a new computer for 1,000 using a credit card,
A) his bank account decreases by 1,000.
B) he is taking out a loan for 1,000.
C) the credit card is acting as money.
D) the money supply decreases by 1,000.
E) the credit card is performing the function of an unit of account.
Question 2
An increase in the discount rate
A) increases the cost of reserves borrowed from the Fed.
B) signals the Fed's desire to increase the money supply.
C) signals the Fed's desire to lend increased reserves to banks.
D) reduces the cost of reserves borrowed from the Fed.
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