Whatis the efficient markets hypothesis? What are the most importantcharacteristics of markets that are necessary for them to be efficient?
Howdo stock prices behave if stock markets are efficient and if investors do notcare about risk?
Explainthe major options available to a bank that is short of reserves. Whatdetermines which option a bank is likely to choose?
Howcan the Fed affect the amount of reserves that banks hold? What interest ratescan it change to manipulate the quantity of reserves?