a. 10. If the Fed wants to raise interest rate in the economy, it would Buy securities in the open market b. Sell securities in the open market Lower the minimum reserve requirements on deposits 11.A bond with a shrinking fund is _risky than an identical bond but w/o this feature and would require return. more; higher c. a. b. more; lower C. less; higher d. less; lower a. c. 12. Agency problem in finance arises because Shareholders do not trust the management b. Management may act against the will of shareholders Shareholders and management have different foals d. Company's board of directors and management may have different goals 13. Appreciation of U.S. dollar relative to Chinese yuan would make U.S. goods Cheaper b. More expensive Equally expensive before and after depreciation in China. a. c. 14. A dealers bid price is always __than his/her asks price Higher a. b. Lower