Possession of information by one party in a financial transaction but not by the other party is
A) symmetric information. B) asymmetric information.
C) informational hazard. D) financial intermediation.
B
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Riley deposits $4,000 cash in her checkable deposit at Fershur Bank. If the desired reserve ratio is 5 percent, Fershur Bank's
A) desired reserves increase by $4,000. B) liabilities do not change but its assets increase. C) excess reserves increase by $4,000. D) desired reserves increase by $200 and its excess reserves increase by $3,800. E) assets and its liabilities change in opposite directions.
Increasing opportunity cost while moving along a production possibilities frontier is the result of
A) taxes. B) firms' needs to produce profits. C) the fact that it is more difficult to use resources efficiently the more society produces. D) the fact that resources are not equally productive in alternative uses.
Keynesian models involve considerable efforts to explain the determinants of
A) the money supply. B) aggregate supply. C) liquidity preference. D) the demand deposit multiplier.
When an economy is operating on its production possibilities curve, more production of one good means less production of another because:
a. resources are limited. b. resources are not perfectly adaptable to alternative uses. c. wants are limited. d. wants are unlimited. e. some resources are not employed.