Changes in which of the following will cause changes in the equilibrium federal funds rate?
A) the demand for excess reserves by banks
B) the supply of reserves created through past open market operations
C) the demand for required reserves by banks
D) all of the above
D
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The main policy-making organ of the Federal Reserve System is
A) the Board of Governors. B) the Federal Reserve branch banks. C) the Federal Reserve chairman and the Federal Reserve branch bank presidents. D) the Federal Open Market Committee.
Suppose that, in the long run, a dairy's variable costs are VC = 2Q2 (where Q is the number of gallons of milk produced each day), its marginal cost is MC = 4Q and there is an avoidable fixed cost of $50 per day. In the long run, there is free entry into the market. What is the dairy's total cost function?
A. TC = 2Q2 + 4Q B. TC = 4Q + 50 C. TC = 2Q2 + 50 D. TC = 2Q2 + 4Q + 50
If a firm increases its output level by 50 percent and, as a result, long-run total cost rises by 40 percent, the firm is experiencing
a. diseconomies of scale b. constant returns to scale c. economies of scale d. increasing marginal returns e. diminishing marginal returns
The Classical model
a. is now discredited b. was developed by John Maynard Keynes c. has been completely displaced by the short-run macro model d. helps us to understand the performance of the economy in the long run e. is most useful in helping us to predict when an economic downturn will occur