A simple deposit multiplier equal to four implies a required reserve ratio equal to
A) 100 percent.
B) 50 percent.
C) 25 percent.
D) 0 percent.
C
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Nominal exchange rates differ from real exchange rates in that nominal exchange rates
A) do not correct for differing interest rates across countries. B) do not measure the purchasing power of the currency. C) are fixed, while real exchange rates are flexible. D) are flexible, while real exchange rates are fixed.
Figure 11.3Figure 11.3 shows demands and costs for a monopolistically competitive firm. When the firm's demand curve shifts from D1 to D2 and to D3:
A. the firm's economic profit remains the same. B. the firm's marginal revenue at the profit maximizing output level is decreasing. C. the firm's marginal cost at the profit maximizing output level is increasing. D. the firm's average cost at the profit maximizing output level is decreasing.
The rate of production that maximizes the positive difference between total revenues and total costs is the
A) profit-maximizing rate of production. B) rate of production at which marginal revenue equals marginal product. C) rate of production at which marginal revenue equals average revenue. D) rate of production at which average revenue equals average total cost.
The law of one price states that if the costs of transportation are ________, the price of the same good in different countries should be ________.
A. small; roughly the same B. large; roughly the same C. large; exactly the same D. small; very different