When banks hold excess reserves the:
A. money multiplier underestimates how much money will be created in the economy.
B. money multiplier overestimates how much money will be created in the economy.
C. reserve ratio is not fully functioning, and should be lowered.
D. reserve ratio is not fully functioning, and should be raised.
Answer: B
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If a country's currency appreciates, then its exports will cost ________ abroad and its imports will cost ________ domestically
A) less; less B) less; more C) more; less D) more; more
The combined incomes of Walmart, ExxonMobil and Chevron total more than the GDP of:
a. Belgium b. Denmark c. Ireland d. all of these
If the price of a product is $12, its average total cost is $2 and its average variable cost is $15 at the profit-maximizing output level, in the short run the firm:
A. should expand output until MR = MC. B. cannot cover total fixed costs. C. experiences a loss. D. must always shut down.
Figure 9.4 represents the market for used 12 megapixel digital cameras. Suppose buyers are willing to pay $400 for a plum (high-quality) used digital camera and $200 for a lemon (low-quality) used digital camera. If buyers believe that 50% of used digital cameras in the market are lemons (low quality), what is consumers' willingness to pay ($W)?
A. $100 B. $200 C. $300 D. $400