If the reserve requirement were cut in half, the banking system’s ability to extend loans would be
a. increased by 50 percent.
b. reduced by 100 percent.
c. increased by 25 percent.
d. nearly doubled.
d. nearly doubled.
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If you borrow $5,000 from your bank to purchase shares of Twitter from your cousin Vinny, this is an example of obtaining ________ financing and purchasing the stock in a ________ market
A) direct; primary B) indirect; secondary C) direct; secondary D) indirect; primary
Consider a firm with the following cost and revenue information: ATC = $8, AVC = $7, and MR = MC = $6 . If the firm produces Q = 60 in the short run, it:
a. is minimizing losses. b. makes a total loss of $60. c. should produce more output. d. is making a mistake and should shut down. e. is maximizing total profit.
In order to extract the entire consumer surplus, a firm should set prices exactly equal to the price that an individual actually pays
a. True b. False Indicate whether the statement is true or false
If you take $500 out of a savings deposit and put it into a checking account, the immediate effect (do not consider the money multiplier):
a. M1 rises, M2 remains the same, and the monetary base remains the same. b. M1 falls, M2 falls, and the monetary base remains the same. c. M1 rises, M2 rises, and the monetary base remains the same. d. M1, M2, and the monetary base fall. e. M1, M2, and the monetary base remain the same.