Answer:
Explanation:
The discount rate is the interest rate on loans that the Federal Reserve makes to banks. Banks occasionally borrow from the Federal Reserve when they find themselves short on reserves. A lower discount rate increases banks' incentives to borrow reserves from the Federal Reserve, thereby increasing the quantity of reserves in the banking system and causing the money supply to rise.The federal funds rate is the interest rate that banks charge one another for short-term (typically overnight) loans. When the Federal Reserve uses open-market operations to sell government bonds, the quantity of reserves in the banking system increases banks' demand for borrowed reserves declines, and the federal funds rate decreases
Answer:
National security demands have made it imperative for the US to close the toilet paper trade gap (just think what would happen in times of war if we couldn’t produce our own!). The government has decided to reduce our imports from 100 million units to 90 million units. As the supreme TP czar, which of the following policies should be chosen? Show and explain why. a. A production subsidy b. A consumption tax c. An import tariff.
Answer:
b. Purchasing power parity
Explanation:
The purchasing power parity theory is based on a world price for equivalent goods. This means that a good in the United States will cost the same as a good in Canada. Since the price of the good is $US 100 in the United States, then the same good should cost the equivalent of in Canadian dollars.
The supply and demand of the food
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