For the money expansion process to produce the maximum potential multiplier effect
A) all loans of a given bank have to be deposited in that bank.
B) the Fed has to sell government bonds to back up the loans.
C) the required reserve ratio has to be 100 percent.
D) all loans from banks have to be redeposited throughout the banking system.
D
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Suppose there are three power-generating plants, each of which has access to 5 different production processes. The table below summarizes the cost of each production process and the corresponding number of tons of smoke emitted each.ProcessABCDE(smoke/day)(4 tons/day)(3 tons/day)(2 tons/day)(1 tons/day)(0 tons/day)Cost to Firm X ($/day)$500$514$530$555$585Cost to Firm Y ($/day)$400$420$445$480$520Cost to Firm Z ($/day)$300$325$360$400$550 Suppose the government decides to impose a tax on each ton of smoke emitted. What would be the lowest tax, in whole dollars, that would reduce emissions to 6 tons per day?
A. $41 per ton B. $36 per ton C. $26 per ton D. $21 per ton
The concept of comparative advantage is based upon:
A) absolute labor productivity. B) relative labor costs. C) dollar prices of labor. D) relative opportunity costs.
If the real interest rate is 2 percent and inflation rate is 1 percent, what is the nominal interest rate?
A. 1 percent B. 0 percent C. 2 percent D. 3 percent
An increase in demand will induce entry by firms in the long run.
Answer the following statement true (T) or false (F)