The efficient price of a license fee is determined by the difference between
a. Marginal revenue and marginal cost
b. Average revenue and marginal cost
c. Total revenue and total cost
d. Average revenue and total cost
e. Total revenue and marginal cost
Ans: e. Total revenue and marginal cost
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Whenever the Fed ________ excess reserves in the banking system, they tend to ________ the overall money supply
A) raises; reduce B) raises; increase C) lowers; increase D) lowers; stabilize
Suppose the U.S. economy enters a recession and incomes fall. What will happen to the equilibrium prices and quantities of normal goods? Would your answer be the same if you were discussing inferior goods? Why or why not?
What will be an ideal response?
If Slovenia is a large country in world trade, then if it imposes a large set of tariffs on many of its imports, this would
A) improve its terms of trade. B) have no effect on its terms of trade. C) harm its terms of trade. D) decrease its marginal propensity to consume. E) increase its exports.
In a closed economy, the goods market is in equilibrium when
A) Y = S + I + G. B) C + S = I + G. C) C + I = S + G. D) Y = C + I + G.