The rate of interest charged by Federal Reserve banks for lending reserves to member banks is the
A. Commercial paper rate.
B. Federal funds rate.
C. Prime rate.
D. Discount rate.
Answer: D
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If the level of output produced by the firms in a perfectly competitive market has no effect on the prices of the inputs used by the firms, the market supply curve will be flatter than the supply curve for an individual firm in the market
Indicate whether the statement is true or false
If government spending does not change, an increase in the government deficit leads to
A) an increase in current consumption. B) a decrease in current consumption. C) no change in current consumption. D) it depends on the marginal propensity to consume.
If firms are producing at a profit-maximizing level of output where the price is equal to the average total cost:
A. accounting profits may be negative. B. accounting profits must be zero. C. economic profits may be positive. D. economic profits must be zero.
Recognition lag is the time it takes for policymakers to recognize the existence of an economic expansion or a recession
a. True b. False Indicate whether the statement is true or false