Comparative advantage is most closely related to which of the following concepts?
A) efficiency
B) opportunity cost
C) fairness
D) productivity
E) competition
B
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Which of the following describes a characteristic of a perfectly competitive market?
A) Equilibrium is achieved when demand for the product sold in the market equals the supply. B) There are many buyers and sellers. C) There are many sellers but few buyers. D) There are many buyers but few sellers.
If the proportion of GDP that people choose to hold in the form of money balances is 0.25, then a $100 increase in the money supply will lead to a rightward shift in the LM curve in the amount of
A) $400. B) $ 25. C) $ 75. D) $100.
If the equilibrium rate of interest would be 10 percent, but the usury law sets 8 percent,
a. the quantity of funds supplied would be greater than the quantity demanded. b. economic efficiency would be promoted. c. some applicants for loans would likely be turned down. d. lenders would be able to fund fully all requests for loans.
In its original role as "lender of last resort" the Fed was supposed to
a. lend money to people in regions without banks. b. lend money to developing nations. c. keep the money supply from drying up during financial panics. d. provide mortgage lending to returning soldiers.