Many investment banks quickly collapsed when the housing market collapsed because
a. the Federal Reserve was unwilling to provide them with short-term loans.
b. they ignored the risk assigned by the rating agencies, resulting in leverage ratios that were too low.
c. new regulations required investment banks to maintain more capital against their residential housing loans than was true for commercial business loans.
d. they were highly leveraged and had little reserves on hand to meet the short-term debt obligations of the mortgage-backed securities.
D
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Your classmates from the University of Chicago are planning to go to Miami for spring break, and you are undecided about whether you should go with them. The round-trip airfares are $600, but you have a frequent-flyer coupon worth $500 that you could use to pay part of the airfare. All other costs for the vacation are exactly $900. The most you would be willing to pay for the trip is $1400. Your only alternative use for your frequent-flyer coupon is for your trip to Atlanta two weeks after the break to attend your sister's graduation, which your parents are forcing you to attend. The Chicago-Atlanta round-trip airfares are $450. If the Chicago-Atlanta round-trip air fare were $350, should you use the coupon to go to Miami?
A. Yes, your economic surplus would be $400. B. Yes, your economic surplus would be $50. C. No, your economic surplus would be ?$100. D. No, your economic surplus would be ?$50.
The twin responsibilities of the Federal Reserve are:
A. to maintain full employment and balance the federal budget. B. to ensure price stability and maintain full employment. C. to ensure price stability and regulate international trade. D. to print money and ensure price stability.
One country has an absolute advantage over another country if it can produce a good using smaller quantities of resources
a. True b. False Indicate whether the statement is true or false
Refer to the figure below.________ inflation will eventually move the economy pictured in the diagram from short-run equilibrium at point ________ to long-run equilibrium at point ________. 
A. Rising; A B. Falling; A; C C. Falling; B: C D. Rising; A; C