Which seller is "selling short"?
A) Colleges that require the entire term's tuition prior to the first day of class
B) A magazine that sells you a two-year subscription
C) A major league baseball team that sells you a season ticket
D) They are all selling short.
E) None is selling short because all are reducing their risks.
D
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In the figure above, the equilibrium market price is $20. Area A is the
A) marginal cost of 150th unit. B) willingness to pay for the 150th unit. C) producer surplus. D) consumer surplus. E) marginal benefit of 150th unit.
Prime Pharmaceuticals has developed a new asthma medicine, for which it has a patent. An inhaler can be produced at a constant marginal cost of $2/inhaler
The demand curve, marginal revenue curve, and marginal cost curve for this new asthma inhaler are in the figure above. With its patent giving it a monopoly for its new inhaler, if Prime Pharmaceuticals operates as a single-price monopoly, then there will be a deadweight loss equal to A) $24 million. B) zero. C) $16 million. D) $32 million.
If a bank had demand deposits of $50 million and it faced a 25 percent required reserve ratio, it would be required to have how many reserves?
a. $50 million b. $37.5 million c. $25 million d. $12.5 million
?Exhibit 10A-1 Aggregate demand and supply model
Given the shift of the aggregate demand curve from AD1 to AD2 in Exhibit 10A-1, the real GDP and price level (CPI) in long-run equilibrium will be:
A. $8 billion and 150. B. $12 billion and 200. C. $8 billion and 250. D. $8 billion and 200.