A roller coaster operator produces thrill-packed rides using electricity and a roller coaster. For the roller coaster operator, electricity is
A. an opportunity cost.
B. a variable cost.
C. a fixed cost.
D. a sunk cost.
Answer: B
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If the price of motel rooms increases by 10% while the prices of other goods and services increase by 5% on average, the relative price of motel rooms has:
A. decreased by 5%. B. decreased by 10%. C. increased. D. remained constant.
When a market is in equilibrium, the total amount of consumer surplus must be ________ the total amount of producer surplus
A) larger than B) equal to C) less than D) None of the above answers are correct.
Typically, total utility derived from consumption decreases as more of a good is consumed
Indicate whether the statement is true or false
A bank has a reserve requirement of 0.08. If it has demand deposits of $200,000 and is holding $4,000 in reserves:
A. the bank is not meeting its reserve requirement. B. all the bank's reserves are excess reserves. C. the bank is holding $2,000 in excess reserves. D. the bank could extend additional loans and still meet its reserve requirement.