Figure 21-5

question 186

Multiple Choice

Figure 21-5
(a) (b)

-Refer to Figure 21-5. In graph (a) , what is the price of good X relative to the price of good Y (i.e., PX/PY) ?

• A) 1/3
• B) 1/4
• C) 3
• D) 4

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Definitions:

United Bank

A generic term that may refer to any bank operating under the name "United Bank" in various parts of the world.

Excess Reserves

The reserves held by banks over and above the minimum required by the central bank, available for lending or investment.

Money Supply

The total financial resources existing in an economy at a certain time.

Open Market Operations

These are financial activities where central banks buy or sell government securities in the open market to control the money supply and influence interest rates.