If commercial banks are increasing their borrowing from the Fed ...

[dalyningkenk]

If commercial banks are increasing their borrowing from the Fed while the Fed is selling government securities, the borrowing of the commercial banks from the Fed will tend to:
 a. reinforce the contractionary open market operations policy.
  b. reinforce the expansionary open market operations policy.
  c. counteract the contractionary open market operations policy.
  d. counteract the expansionary open market operations policy.

Question 2

If the government provides a subsidy in one industry and raises the tax revenue by taxing another industry, would, other things equal, cause welfare costs in both industries.
 a. True
  b. False
  Indicate whether the statement is true or false

[jlaineee]

Answer to Question 1

c

Answer to Question 2

True

[dalyningkenk]

Gracias!

[diana chang]

Excellent